Should Bangladesh monitor core inflation for conducting monetary policy?

Shahiduzzaman, Md. and Mortaza, M. Golam (2008) Should Bangladesh monitor core inflation for conducting monetary policy? Working Paper. Bangladesh Bank , Dhaka, Bangladesh. [Report]

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One of the central objectives of traditional monetary policy is inflation control since the belief is that, among others, low inflation helps to improve resource allocation and fosters rapid and stable economic growth. The view also holds that inflation is primarily a monetary phenomenon so that low inflation is to be achieved mainly through aggregate demand control by pursuing contractionary monetary (and fiscal) policies. It is argued that these policies should also be supported by liberalization, privatization, and other macroeconomic reforms to create a more open and competitive economy driven by the private sector. In short, the argument is that there exists a trade off between inflation and growth (alternatively between inflation and unemployment) that makes inflation targeting as the dominant paradigm in monetary policy.

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Item Type: Report (Working Paper)
Item Status: Live Archive
Additional Information: Copyright © 2008 by Bangladesh Bank.
Faculty / Department / School: Historic - Faculty of Business - School of Accounting, Economics and Finance
Date Deposited: 26 Jun 2013 23:49
Last Modified: 05 Feb 2018 04:38
Uncontrolled Keywords: Bangladesh; inflation; monetary policy; economic growth
Fields of Research : 14 Economics > 1402 Applied Economics > 140212 Macroeconomics (incl. Monetary and Fiscal Theory)
14 Economics > 1401 Economic Theory > 140102 Macroeconomic Theory
16 Studies in Human Society > 1605 Policy and Administration > 160505 Economic Development Policy
Socio-Economic Objective: B Economic Development > 91 Economic Framework > 9101 Macroeconomics > 910108 Monetary Policy

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