On the limits of the possibility of inflation targeting

2017 ◽  
pp. 71-87
Author(s):  
K. Korishchenko ◽  
N. Pilnik
Keyword(s):  
Exchange Rate ◽  
Inflation Targeting ◽  
Econometric Model ◽  
Oil Prices ◽  
Policy Regime ◽  
Russian Economy ◽  
Exchange Rate Management ◽  
Price Growth ◽  
Main Factors ◽  
Main Determinants

The purpose of this article is to identify the main determinants of consumer price growth in the Russian economy. To achieve this goal, the degree of influence on inflation of the monetary policy of the Bank of Russia, tariff regulation and ruble exchange rate has been determined in the course of the work. The econometric model of inflation formation is used as a research tool depending on the dynamics of the main factors. The article explores the reasons for the significant growth in the volatility of the dollar and, as a consequence, its impact on consumer inflation. According to the presented model, the main volatility generators are the volatility of oil prices and the policy regime of exchange rate management.

Monetary policy and the effect of the transfer of oil prices to inflation

2020 ◽  
pp. 41-50
Author(s):  
Ph. S. Kartaev ◽  
I. D. Medvedev
Keyword(s):  
Monetary Policy ◽  
Inflation Targeting ◽  
Dynamic Models ◽  
Oil Prices ◽  
Oil Price ◽  
Oil Price Shocks ◽  
Negative Effects ◽  
Price Shocks ◽  
Policy Regime ◽  
The Impact

The paper examines the impact of oil price shocks on inflation, as well as the impact of the choice of the monetary policy regime on the strength of this influence. We used dynamic models on panel data for the countries of the world for the period from 2000 to 2017. It is shown that mainly the impact of changes in oil prices on inflation is carried out through the channel of exchange rate. The paper demonstrates the influence of the transition to inflation targeting on the nature of the relationship between oil price shocks and inflation. This effect is asymmetrical: during periods of rising oil prices, inflation targeting reduces the effect of the transfer of oil prices, limiting negative effects of shock. During periods of decline in oil prices, this monetary policy regime, in contrast, contributes to a stronger transfer, helping to reduce inflation.

The influence of inflation targeting on the pass-through effect of the exchange rate

2018 ◽  
pp. 70-84
Author(s):  
Ph. S. Kartaev ◽  
Yu. I. Yakimova
Keyword(s):  
Developing Countries ◽  
Monetary Policy ◽  
Exchange Rate ◽  
Inflation Targeting ◽  
Policy Regime ◽  
Short And Long Term ◽  
The Exchange Rate ◽  
Pass Through ◽  
The Impact

The paper studies the impact of the transition to the inflation targeting regime on the magnitude of the pass-through effect of the exchange rate to prices. We analyze cross-country panel data on developed and developing countries. It is shown that the transition to this regime of monetary policy contributes to a significant reduction in both the short- and long-term pass-through effects. This decline is stronger in developing countries. We identify the main channels that ensure the influence of the monetary policy regime on the pass-through effect, and examine their performance. In addition, we analyze the data of time series for Russia. It was concluded that even there the transition to inflation targeting led to a decrease in the dependence of the level of inflation on fluctuations in the ruble exchange rate.

The Impossible Trinity» rule in the context of international experience

2019 ◽  
pp. 90-96
Author(s):  
M.P. Tskhovrebov ◽  
A.S. Tanasova
Keyword(s):  
Exchange Rate ◽  
Inflation Targeting ◽  
Empirical Studies ◽  
Theoretical Development ◽  
External Shocks ◽  
Cross Border ◽  
Relevant Today ◽  
Russian Economy ◽  
Monetary Authorities ◽  
Increased Sensitivity

The article is devoted to the «Trilemma» of the policy of the monetary authorities, or the «rule of impossible trinity». This policy compatibility rule, formulated more than 50 years ago, remains relevant today. Its reliability is generally confirmed by a number of empirical studies, although there are also suggestions on the need to adjust this economic and theoretical development. The corresponding discussion also affects the policy of the Bank of Russia (mega-regulator), which carries out inflation targeting in conditions of the free movement of cross-border capital and the use of a floating ruble exchange rate. Regarding the effectiveness of this policy, carried out in the presence of increased sensitivity of the Russian economy to external shocks, the authors express certain doubts.

scholarly journals Five Years of Inflation Targeting Without Economic Growth: What Should Be Changed? The Case of Russia

2021 ◽  
Vol 12 (3) ◽  
pp. 162
Author(s):  
Oscar Gasanov
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Foreign Exchange ◽  
Inflation Targeting ◽  
Exchange Rate Policy ◽  
Economic Agents ◽  
Price Growth ◽  
The Interest Rate ◽  
The Stability ◽  
High Level

The article provides a review of approaches to assessing and analyzing the effectiveness of the interest rate and exchange rate policy of the Bank of Russia in the period 2015-2019. Despite the decrease in the rate of price growth, inflationary expectations of economic agents remain at a high level. Monetary policy continues to be tight. The stability of the exchange rate to external shocks, expected from the introduction of inflation targeting and a free floating rate, did not happen. The complex of conditions that have developed due to geopolitical factors, low growth rates and the global economic crisis caused by the coronavirus pandemic require the search for new targets, such as economic growth and exchange rate stability. To maintain the stability of the ruble exchange rate, it is recommended to sell foreign exchange reserves accumulated according to the "Budget rule" in an equivalent amount; to support the liquidity of banks during periods of an attack on the ruble, it should through foreign exchange REPO, and develop a derivatives market.

Monetary Policy and Oil Prices

2011 ◽  
Vol 11 (3) ◽  
pp. 1850232
Author(s):  
Mehdi S. Monadjemi
Keyword(s):  
Monetary Policy ◽  
International Trade ◽  
Exchange Rate ◽  
Inflation Targeting ◽  
Commodity Prices ◽  
Oil Prices ◽  
Central Banks ◽  
Trade Shocks ◽  
The Exchange Rate

Because of volatility, commodity prices are excluded from the CPI when inflation targeting is exercised. Rising commodity prices contribute to inflation but central banks show no reaction since the CPI does not register rise in prices. Frankel (2006) argues that monetary policy should consider the price of important export commodities such as oil, in oil exporting countries. He maintains that by doing so, central banks are able to benefit from the fluctuations of the exchange rate in the presence of a negative international trade shocks. Central banks cannot benefit from the fluctuation of the exchange rate if inflation targeting is the strategy for conducting monetary policy.

"Good" and "bad" billionaires in post-soviet Russia (1997–2020)

2022 ◽  
pp. 22-38
Author(s):  
Grigorii Isaakovich Khanin ◽  
Keyword(s):  
Economic Crisis ◽  
Oil Prices ◽  
Economic Reforms ◽  
Social Differentiation ◽  
Negative Consequences ◽  
Political Structure ◽  
Russian Economy ◽  
Main Factors ◽  
Soviet Russia

The article shows the idea of American economist Ruchir Sharma about "good" and "bad" billion-aires in relation to modern Russia, indicates the criteria proposed by Ruchir Sharma for classifying billionaires as "good" and "bad". The ratio between "good" and "bad" billionaires in modern Russia is studied for the period from 1997 till 2020. To identify "good" billionaires, their list for 2008, 2015 and 2020 is given, indicating companies and industry. For the same years, the shares of "good" billionaires in the total amount of billionaires and their total property were calculated. Sig-nificant growth of a number of "good" billionaires and their share in their total amount and total property of billionaires has been found. The main factors that determined the dynamics and share of "good" billionaires are indicated: the dynamics of world oil prices and the maturity of the Russian bourgeoisie. The share of "good" billionaires in Russia is being compared with the remaining 19 countries analysed by Ruchir Sharma. It turns out that even in the best year of 2020 for Russia in terms of the share of "good" billionaires, it was far behind other countries. Objective and subjective reasons for Russia’s catastrophic lag in the share of "good" billionaires are shown. Objective reasons include the youth of Russian capitalism and the huge demographic losses of Russia in the XX century, especially among the creative part of the population. Subjective reasons include the vices of the carried out in post-Soviet Russia political and economic reforms and the resulting economic and political structure. The negative consequences of the small share of "good" billionaires are analysed. These include the economic crisis in Russia in 2008 and the unsatisfactory structure of the Russian economy, as well as a huge social differentiation. The author proposes measures for accelerated modernization of the Russian economy, creating the most favourable conditions for the growth of "good" billionaires.

Prospects of the Initiation of Inflation Targeting in RF

2008 ◽  
pp. 46-57 ◽  
Author(s):  
A. Ulyukaev ◽  
S. Drobyshevsky ◽  
P. Trunin
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Economic Performance ◽  
Inflation Targeting ◽  
Policy Regime ◽  
Monetary Authorities ◽  
The Exchange Rate

Bank of Russia officials have recently declared the possibility of switching to the inflation targeting regime in the medium run. The article considers benefits and shortcomings of monetary policy regime as well as the economic performance of the inflation targeting countries. The authors conclude that Russia now starts meeting conditions crucial for the success of inflation targeting. In such circumstances Russian monetary authorities have an opportunity to weaken the exchange rate goal in favor of the inflation goal.

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