Home  Journals  Finance and Credit  23(695) - 2016 June

RETRACTED: Applying the inflation targeting regime under economic uncertainty

Retraction reason: Plagiarism found.
The article retraction was innitiated by the author.
Retraction date September 25, 2019

Vol. 22, Iss. 23, JUNE 2016

Article PDF Version

Received: 25 April 2016

Received in revised form: 16 May 2016

Accepted: 31 May 2016

Available online: 29 June 2016

Subject Heading: MONETARY ACCOMMODATION

JEL Classification: Е31, Е42, Е58, Е59

Pages: 24-35

Subject When there is a threat of inflation, central banks start increasing the interest rate and apply the inflation targeting regime, which implies a planned 'formation' of inflation as the primary goal of financial and credit program. This approach enables to take adequate response measures even before the onset of the crisis.
Objectives The study aims to provide a rationale for the need to apply the inflation targeting regime under economic uncertainty.
Methods Methodological basis of the research includes general scientific methods of knowledge (dialectical, a combination of historical and logical unity, methods of structural and functional analysis, traditional techniques of economic analysis and synthesis) and specific research methods.
Results I substantiate the role of inflation targeting regime under economic uncertainty, define conditions for its implementation, reveal its advantages and disadvantages, and present an algorithm of actions. Furthermore, the paper discloses factors hindering the Bank of Russia to achieve its objectives in applying the inflation targeting regime.
Conclusions The main prerequisites for the inflation targeting regime introduction are favorable macroeconomic environment, floating rate of the national currency, stable financial system, public confidence in the monetary policies of the Central Bank and its independent status in the realization of goals and objectives of the monetary policy. The transition to inflation targeting regime under the floating ruble rate, which is planned by the Central Bank of the Russian Federation, may improve the investment climate in Russia.

Keywords: inflation targeting, monetary policy, Central Bank, inflation target, economic growth

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