Interest Rate Targeting in a Small Open Economy : The Predetermined Exchange Rates Case /

An important hurdle in analyzing interest rate targeting is that standard models usually lead to price level or inflation rate indeterminacy. This paper develops a simple framework in which such problems do not arise because the bonds whose interest rate is controlled provide liquidity services. Thi...

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Bibliographic Details
Main Author: Calvo, Guillermo
Other Authors: Vegh Gramont, Carlos
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 1990.
Series:IMF Working Papers; Working Paper ; No. 1990/021
Online Access:Full text available on IMF