Perspectives on inflation targeting, financial stability and the global crisis

BIS Papers No 51
March 2010

This BIS Paper discusses lessons provided by the global financial crisis for inflation targeting and financial stability. It contains selected presentations from the BIS-sponsored sessions at two Latin American and Caribbean Economic Association (LACEA) annual meetings: November 2008, in Rio de Janeiro, and October 2009, in Buenos Aires. The 2008 papers in this volume are by José de Gregorio, Governor of the Central Bank of Chile, and Guillermo Calvo, professor of economics at Columbia University; the 2009 presentations are by Vittorio Corbo, former Governor of the Central Bank of Chile, and Michael Dooley, professor of economics at the University of California, Santa Cruz.

JEL-classification: E42, E52, E58, F31, F41, G28

Keywords: inflation targeting, financial stability, global financial crisis, bank regulation, foreign reserves, BIS, LACEA

Introduction

Perspectives on inflation targeting, financial stability and the global crisis

Part I: Challenges to inflation targeting

Challenges to inflation targeting: raising some issues
Recent challenges of inflation targeting
Inflation targeting in hard times

Part II: Central banks and the global crisis: lessons and challenges

Financial stability in a crisis: What is the role of the central bank?
Central banks and the financial crisis
Central bank responses to financial crises