What is meant by inflation targeting? Are central banks still committed to such a policy? by Komilla Chadha
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Info: This is my dissertation on which I received a first. This essay will explain what is meant by inflation targeting by delving deeper into the theory and practice of inflation targeting. This is followed by the case-study analysis of the Bank of England to demonstrate that in times of recession, the commitment to inflation targeting can be abandoned. The following case studies on Japan and USA will be used to investigate to what extent is this lack of commitment detrimental. Finally, a concluding remark, that central banks are committed to inflation targeting subject to the condition that the economy is not suffering a downturn or crisis, will be proposed.