Maintaining Low Inflation: Rationale and Reality

  • Marvin Goodfriend


Inflation targeting has emerged in recent years as the leading framework within which monetary policy is conducted around the world.1 In the United States, the Federal Reserve does not have an explicit inflation target; but it is fair to say that the Fed, as never before in its history, is committed to maintaining low inflation. Likewise, the Bank of Japan is committed to maintaining stable prices. The new Eurosystem has adopted an explicit target band for inflation in response to the mandate in the Maastricht Treaty to maintain price stability. And central banks in countries such as Australia, Canada, Israel, New Zealand, Sweden, and the United Kingdom today employ explicit inflation targets.


Interest Rate Monetary Policy Central Bank Real Interest Rate Price Stability 
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Copyright information

© Springer Science+Business Media New York 2001

Authors and Affiliations

  • Marvin Goodfriend
    • 1
  1. 1.Federal Reserve Bank of RichmondUSA

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