Towards an integrated inflation targeting framework in middle-income countries: a research agenda

Keynote speech by Mr Luiz Awazu Pereira da Silva, Deputy General Manager of the BIS, at the 2nd ECBN Policy Research Conference on "Macroprudential Instruments and Financial Cycles", Ljubljana, 29 September 2016.

The damage inflicted by the recent Global Financial Crisis (GFC) changed the terms of the old debate about "leaning before" versus "cleaning up after" a financial crisis. Easy monetary conditions in advanced economies and large capital flows to middle income countries add to the complexity of the discussion. A proposed integrated inflation targeting framework (IIT regime) that comprises monetary, fiscal and macroprudential policies would be best suited to achieve price and financial stability in this context. But the complexity and interconnectedness of these policies means that the development of this framework will require substantial research effort by all interested parties in academia and policymaking.