What Is Inflation Targeting? Is It Possible for a Central

question 34

Essay

What is inflation targeting? Is it possible for a central bank that adopts inflation targeting to also pursue output stabilisation?

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Definitions:

Interdependence

A relationship between entities where each is mutually dependent on the other, often seen in ecosystems, economies, and social systems.

Collaborative Goals

Objectives that are pursued together by two or more parties, with a focus on mutual benefit and shared success.

Behaviorally Specific

An approach that focuses on concrete, observable actions rather than on abstract traits or intentions.

Retrospective Goals

Objectives set after the fact, often used to make sense of past behaviors or outcomes in a new light.