Finance and Credit
 

Short-term results of the abrupt transition to inflation-targeting policies in the Russian Federation

Vol. 23, Iss. 34, SEPTEMBER 2017

PDF  Article PDF Version

Received: 21 July 2017

Received in revised form: 7 August 2017

Accepted: 21 August 2017

Available online: 19 September 2017

Subject Heading: MONETARY ACCOMMODATION

JEL Classification: С23, E52, E58, O42

Pages: 2032–2043

https://doi.org/10.24891/fc.23.34.2032

Butuzova A.S. Lomonosov Moscow State University, Moscow, Russian Federation
butuzova_anuta@mail.ru

Importance The problem of prudent monetary policy is crucial nowadays. One of the mitigating and prudential methods of regulating monetary policy adjustment is inflation targeting. In the transition to a floating exchange rate and an inflation-targeting regime in Russia, this subject is particularly important.
Objectives I concentrate on the comprehensive analysis of initial conditions before the transition to inflation-targeting regime and building economic models after the transition.
Methods In studying the peculiarities of transition to inflation targeting, I used economic modeling, synthesis method, and a retrospective analysis. The economic interpretation was carried out on the basis of classical economic models.
Results Short-term results have been revealed and the medium-term results of transition to inflation targeting in Russia are modeled.
Conclusions and Relevance I conclude that negative short-term results of the transition to inflation targeting are determined by the untimely transition. Significant specificity of the Russian economy in comparison with other countries requires a prudential approach. Macroeconomic and geopolitical conditions should be taken into account.

Keywords: macroeconomics, monetary policy, exchange rate, inflation targeting, currency policy

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