Inflation Inertia in Egypt and its Policy Implications

Kenji Moriyama

No 2011/160, IMF Working Papers from International Monetary Fund

Abstract: 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.

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 (search for similar items in EconPapers)
Pages: 26
Date: 2011-07-01
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Citations: View citations in EconPapers (8)

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