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Does Adoption of Inflation Targeting Reduce Exchange Rate Volatility and Enhance Economic Growth

Received: 27 November 2013     Published: 30 December 2013
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Abstract

Recently, inflation targeting has been adopted in many countries. One important achievement derived from the assessment of this framework can be exchange rate stability, as exchange rate is thought to relate to the target of the inflation rate itself or a stable inflation rate. This article provides empirical analysis of whether or not the adoption of inflation targeting framework has reduced exchange rate volatility. Also, as the final goal of this framework is to attain sound economic growth with a stable and adequate inflation rate, the relationship between inflation targeting and economic growth is examined. The results show that inflation targeting reduces exchange rate volatility and causes economic growth.

Published in Journal of World Economic Research (Volume 2, Issue 6)
DOI 10.11648/j.jwer.20130206.11
Page(s) 104-109
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2013. Published by Science Publishing Group

Keywords

Exchange Rate, Growth, Inflation Targeting, Volatility

References
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Cite This Article
  • APA Style

    Yutaka Kurihara. (2013). Does Adoption of Inflation Targeting Reduce Exchange Rate Volatility and Enhance Economic Growth. Journal of World Economic Research, 2(6), 104-109. https://doi.org/10.11648/j.jwer.20130206.11

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    ACS Style

    Yutaka Kurihara. Does Adoption of Inflation Targeting Reduce Exchange Rate Volatility and Enhance Economic Growth. J. World Econ. Res. 2013, 2(6), 104-109. doi: 10.11648/j.jwer.20130206.11

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    AMA Style

    Yutaka Kurihara. Does Adoption of Inflation Targeting Reduce Exchange Rate Volatility and Enhance Economic Growth. J World Econ Res. 2013;2(6):104-109. doi: 10.11648/j.jwer.20130206.11

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  • @article{10.11648/j.jwer.20130206.11,
      author = {Yutaka Kurihara},
      title = {Does Adoption of Inflation Targeting Reduce Exchange Rate Volatility and Enhance Economic Growth},
      journal = {Journal of World Economic Research},
      volume = {2},
      number = {6},
      pages = {104-109},
      doi = {10.11648/j.jwer.20130206.11},
      url = {https://doi.org/10.11648/j.jwer.20130206.11},
      eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jwer.20130206.11},
      abstract = {Recently, inflation targeting has been adopted in many countries. One important achievement derived from the assessment of this framework can be exchange rate stability, as exchange rate is thought to relate to the target of the inflation rate itself or a stable inflation rate. This article provides empirical analysis of whether or not the adoption of inflation targeting framework has reduced exchange rate volatility. Also, as the final goal of this framework is to attain sound economic growth with a stable and adequate inflation rate, the relationship between inflation targeting and economic growth is examined. The results show that inflation targeting reduces exchange rate volatility and causes economic growth.},
     year = {2013}
    }
    

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  • TY  - JOUR
    T1  - Does Adoption of Inflation Targeting Reduce Exchange Rate Volatility and Enhance Economic Growth
    AU  - Yutaka Kurihara
    Y1  - 2013/12/30
    PY  - 2013
    N1  - https://doi.org/10.11648/j.jwer.20130206.11
    DO  - 10.11648/j.jwer.20130206.11
    T2  - Journal of World Economic Research
    JF  - Journal of World Economic Research
    JO  - Journal of World Economic Research
    SP  - 104
    EP  - 109
    PB  - Science Publishing Group
    SN  - 2328-7748
    UR  - https://doi.org/10.11648/j.jwer.20130206.11
    AB  - Recently, inflation targeting has been adopted in many countries. One important achievement derived from the assessment of this framework can be exchange rate stability, as exchange rate is thought to relate to the target of the inflation rate itself or a stable inflation rate. This article provides empirical analysis of whether or not the adoption of inflation targeting framework has reduced exchange rate volatility. Also, as the final goal of this framework is to attain sound economic growth with a stable and adequate inflation rate, the relationship between inflation targeting and economic growth is examined. The results show that inflation targeting reduces exchange rate volatility and causes economic growth.
    VL  - 2
    IS  - 6
    ER  - 

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Author Information
  • Department of Economics, Aichi University, Nagoya, Japan

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