Exchange rate interventions and inflation expectations in an inflation targeting economy
Keywords: Exchange rates, inflation expectations, inflation targeting, interventions.
AbstractWe explore the impact of exchange rate interventions on inflation expectations and exchange rates in Chile. We consider two episodes of central bank interventions during the sample period 2007-2012. Our analysis indicate that interventions did have an impact on daily exchange rate returns. In terms of inflation expectations, we find that the intervention program carried out in 2008 had a significant, but relatively short-lived, impact on the distribution of inflation expectations at long horizons. In contrast, the intervention carried out in 2011 shows no relevant impact on the distribution of inflation expectations in Chile.
How to Cite
Pincheira Brown, P. (2018). Exchange rate interventions and inflation expectations in an inflation targeting economy. Economic Analysis Review, 33(2), 43-78. Retrieved from https://www.rae-ear.org/index.php/rae/article/view/655
Upon submission of an article, authors are asked to indicate their agreement to abide by an open-access license. The license permits any user to download, print out, extract, archive, and distribute the article, so long as appropriate credit is given to the authors of the work. The license ensures that your article will be as widely available as possible and that your article can be included in any scientific archive. Please read about the Creative Commons Attribution License before submitting your paper.
Except where otherwise noted, content on this site is licensed under a Creative Commons Attribution 3.0 License