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Monetary Policy Rules in Central and Eastern European Countries: Does the Exchange Rate Matter?

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Abstract
We estimate monetary policy rules for six central and eastern European countries (CEEC) during the period, when they prepared for membership to the EU and monetary union. By taking changes in the policy settings explicitly into account and by introducing several new methodological features we significantly improve estimation results for monetary policy rules in CEEC. We find that in the Czech Republic, Hungary and Poland the focus of the interest rate setting behaviour switched from defending the peg to targeting inflation. For Slovakia, however, there still seemed to be on ongoing focus on the exchange rate. For Slovenia and only after a policy switch for Romania we find a solid relation with inflation as well.
Keywords
CEEC, inflation targeting, transition economies, monetary policy, Taylor rules

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Citation

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MLA
Frömmel, Michael, Garo Garabedian, and Franziska Schobert. “Monetary Policy Rules in Central and Eastern European Countries: Does the Exchange Rate Matter?” Faculteit Economie en Bedrijfskunde Working Papers 2009 : n. pag. Print.
APA
Frömmel, M., Garabedian, G., & Schobert, F. (2009). Monetary Policy Rules in Central and Eastern European Countries: Does the Exchange Rate Matter? Faculteit Economie en Bedrijfskunde Working Papers. Gent: Universiteit Gent, Faculteit Economie en Bedrijfskunde.
Chicago author-date
Frömmel, Michael, Garo Garabedian, and Franziska Schobert. 2009. “Monetary Policy Rules in Central and Eastern European Countries: Does the Exchange Rate Matter?” Faculteit Economie En Bedrijfskunde Working Papers. Gent: Universiteit Gent, Faculteit Economie en Bedrijfskunde.
Chicago author-date (all authors)
Frömmel, Michael, Garo Garabedian, and Franziska Schobert. 2009. “Monetary Policy Rules in Central and Eastern European Countries: Does the Exchange Rate Matter?” Faculteit Economie En Bedrijfskunde Working Papers. Gent: Universiteit Gent, Faculteit Economie en Bedrijfskunde.
Vancouver
1.
Frömmel M, Garabedian G, Schobert F. Monetary Policy Rules in Central and Eastern European Countries: Does the Exchange Rate Matter? Faculteit Economie en Bedrijfskunde Working Papers. Gent: Universiteit Gent, Faculteit Economie en Bedrijfskunde; 2009.
IEEE
[1]
M. Frömmel, G. Garabedian, and F. Schobert, “Monetary Policy Rules in Central and Eastern European Countries: Does the Exchange Rate Matter?,” Faculteit Economie en Bedrijfskunde Working Papers, vol. 2009, no. 611. Universiteit Gent, Faculteit Economie en Bedrijfskunde, Gent, 2009.
@misc{760544,
  abstract     = {{We estimate monetary policy rules for six central and eastern European countries (CEEC) during the period, when they prepared for membership to the EU and monetary union. By taking changes in the policy settings explicitly into account and by introducing several new methodological features we significantly improve estimation results for monetary policy rules in CEEC. We find that in the Czech Republic, Hungary and Poland the focus of the interest rate setting behaviour switched from defending the peg to targeting inflation. For Slovakia, however, there still seemed to be on ongoing focus on the exchange rate. For Slovenia and only after a policy switch for Romania we find a solid relation with inflation as well.}},
  author       = {{Frömmel, Michael and Garabedian, Garo and Schobert, Franziska}},
  issn         = {{N/A}},
  keywords     = {{CEEC,inflation targeting,transition economies,monetary policy,Taylor rules}},
  language     = {{eng}},
  number       = {{611}},
  pages        = {{27}},
  publisher    = {{Universiteit Gent, Faculteit Economie en Bedrijfskunde}},
  series       = {{Faculteit Economie en Bedrijfskunde Working Papers}},
  title        = {{Monetary Policy Rules in Central and Eastern European Countries: Does the Exchange Rate Matter?}},
  volume       = {{2009}},
  year         = {{2009}},
}