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This paper studies the role of central bank communication of its economic assessment in shaping inflation dynamics. Imperfect information about the central bank's assessment - or the basis for monetary policy decisions - could complicate the private sector's learning about its policy response function. We show how clear central bank communication, which facilitates agents' understanding of policy reasoning, could bring about less volatile inflation and interest rate dynamics, and afford the authorities with greater policy flexibility. We then estimate a simple monetary model to fit the Mexican economy, and use the suggested paramters to illustrate the model's quantitative implications in scenarios where the timing, nature and persistence of shocks are uncertain.

Monetary policy --- Inflation targeting --- Targeting, Inflation --- Monetary management --- Economic policy --- Currency boards --- Money supply --- Econometric models. --- Banks and Banking --- Inflation --- Money and Monetary Policy --- Public Finance --- Economic Theory --- Price Level --- Deflation --- Prices, Business Fluctuations, and Cycles: Forecasting and Simulation --- Monetary Policy --- Central Banks and Their Policies --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Taxation, Subsidies, and Revenue: General --- Agriculture: Aggregate Supply and Demand Analysis --- Prices --- Macroeconomics --- Banking --- Public finance & taxation --- Monetary economics --- Economic theory & philosophy --- Communications in revenue administration --- Central bank transparency --- Revenue administration --- Central banks --- Supply shocks --- Economic theory --- Banks and banking --- Revenue --- Supply and demand --- Mexico

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What is the case for adding the unconventional balance sheet policies used by major central banks since 2007 to the standard policy toolkit? The record so far suggests that the new liquidity providing policies in support of financial stability generally warrant inclusion. As the balance sheet policies aimed at macroeconomic stability were used only by a small number of highly credible central banks facing a lower bound constraint on conventional interest rate policy, they are not relevant for most central banks or states of the world. Best practices of these policies are documented in this paper.

Banks and banking, Central --- Financial statements --- Accounting --- Banks and Banking --- Finance: General --- Foreign Exchange --- Investments: Bonds --- Monetary Policy --- Central Banks and Their Policies --- International Policy Coordination and Transmission --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Public Administration --- Public Sector Accounting and Audits --- Portfolio Choice --- Investment Decisions --- General Financial Markets: General (includes Measurement and Data) --- Banking --- Financial reporting, financial statements --- Finance --- Currency --- Foreign exchange --- Investment & securities --- Liquidity --- Central bank balance sheet --- Public financial management (PFM) --- Asset and liability management --- Central banks --- Bonds --- Financial institutions --- Banks and banking --- Finance, Public --- Economics --- United States

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Inflation targeting (IT) is a relatively new monetary policy framework for low-income countries (LICs). The limited number of LICs with an IT framework and the short time that has elapsed since the adoption of this framework explains why there are no previous empirical studies on the performance of IT in LICs. This paper has made a first attempt at filling this gap. It finds that inflation targeting appears to be associated with lower inflation and inflation volatility. At the same time, there is no robust evidence of an adverse impact on output. This may explain the appeal of IT for many LICs, where building credibility of monetary policy is difficult and minimizing output costs of reducing inflation is imperative for social and political reasons.

Inflation targeting --- Targeting, Inflation --- Monetary policy --- Econometric models. --- Finance: General --- Inflation --- Money and Monetary Policy --- Price Level --- Deflation --- Monetary Policy --- Central Banks and Their Policies --- General Financial Markets: General (includes Measurement and Data) --- Monetary economics --- Macroeconomics --- Finance --- Emerging and frontier financial markets --- Monetary transmission mechanism --- Monetary policy frameworks --- Prices --- Financial markets --- Financial services industry --- Ghana

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Since the Asian crisis, ASEAN5 countries have expended considerable effort in trying to develop their domestic bond markets. Yet today these markets are not much larger, relative to GDP, than they were a decade before. How can we explain this? And does this mean that domestic markets have not, in fact, developed? The paper argues that bond market growth has been held back by a sharp fall in investment rates, which has left firms with little need for bond borrowing. Even so, markets have developed in other ways, to such an extent that substantial amounts of foreign portfolio investment have begun to flow into ASEAN5 bonds. These developments have important ramifications. With the investor base growing and infrastructure investment likely to rise, ASEAN5 bond markets could expand rapidly over the next decade, holding out the prospect that the region could finally achieve "twin engine" financial systems.

Bond market --- Bond markets --- Market, Bond --- Capital market --- Finance: General --- Investments: Bonds --- General Equilibrium and Disequilibrium: Financial Markets --- Financial Markets and the Macroeconomy --- Central Banks and Their Policies --- Financial Aspects of Economic Integration --- General Financial Markets: General (includes Measurement and Data) --- Finance --- Investment & securities --- Securities markets --- Emerging and frontier financial markets --- Bonds --- Corporate bonds --- Sovereign bonds --- Financial markets --- Financial institutions --- Financial services industry --- Malaysia

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This note focuses on Russia's monetary policy, which is moving toward low and stable inflation. This paper discusses two analytical measures to analyze the monetary policy—core inflation measure and a group of leading indicators model (LIM). The trimmed mean core inflation is a good indicator for analyzing trend inflation and can be used as a viable target for monetary policy. LIMs are widely used for inflation forecasting and are also useful in detecting turning points in inflation.

Banks and Banking --- Inflation --- Macroeconomics --- Money and Monetary Policy --- Public Finance --- Fiscal Policy --- Price Level --- Deflation --- Energy: Demand and Supply --- Prices --- Monetary Policy --- Interest Rates: Determination, Term Structure, and Effects --- Banking --- Public finance & taxation --- Monetary economics --- Investment & securities --- Fiscal policy --- Oil prices --- Reserve assets --- Oil --- Central banks --- Commodities --- Interest rates --- Foreign exchange reserves --- Petroleum industry and trade --- Korea, Republic of