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Inflation Inertia in Egypt and its Policy Implications
Author: Mr. Kenji Moriyama
Series:
IMF Working Papers
Volume/Issue:
Volume 2011: Issue 160
Language:
English
Publication Date:
01 Jul 2011
DOI:
https://doi.org/10.5089/9781455297733.001
ISBN:
9781455297733
ISSN:
1018-5941
Pages:
26
Keywords:
WP; inflation inertia; Inflation; monetary policy; inflation targeting monetary policy framework; shock volatility; output gap persistency; emerging market; inflation persistency; inflation expectation; Output gap; Inflation targeting; Disinflation; Monetary policy frameworks; Global
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper investigates the degree of inflation inertia in Egypt and its determinants using the cross country data consisting of over 100 countries. Medium-unbiased estimator of inflation inertia in Egypt is high compared to other countries, as indicated by its location around the upper quartile among the sample. The cross country analysis indicates that counter-cyclical macroeconomic policy and fiscal consolidation are a key to reduce inflation inertia and the costs of disinflation.
Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund