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RBA Glossary definition for inflation target

inflation target – A tool to guide monetary policy expressed as a preferred range or figure for the rate of increase in prices over a period. In Australia, the inflation target is between 2 and 3 per cent per annum on average over the course of the business cycle.

RBA Glossary definition for inflation

inflation – A measure of the change (increase) in the general level of prices.

Search Results

Affine Endeavour: Estimating a Joint Model of the Nominal and Real Term Structures of Interest Rates in Australia

1 Feb 2018 RDP 2018-02
Jonathan Hambur and Richard Finlay
Measures of expected inflation may also indicate if, and over what horizon, individuals believe that the central bank will meet its inflation target. ... 5. Robustness Checks. The data sample used in Section 4 spans the period before and after the
https://www.rba.gov.au/publications/rdp/2018/2018-02/full.html

Results

27 Feb 2018 RDP 2018-02
Jonathan Hambur and Richard Finlay
Specifically, there were no inflation-indexed bonds with relatively short maturities trading at this time. ... This coincided with a sharp decline in survey measures of both uncertainty regarding future inflation and of expectations for the level of
https://www.rba.gov.au/publications/rdp/2018/2018-02/results.html

Introduction

27 Feb 2018 RDP 2018-02
Jonathan Hambur and Richard Finlay
Measures of expected inflation may also indicate if, and over what horizon, individuals believe that the central bank will meet its inflation target. ... The difference between these two yields, referred to as break-even inflation, contains information
https://www.rba.gov.au/publications/rdp/2018/2018-02/introduction.html

Affine Endeavour: Estimating a Joint Model of the Nominal and Real Term Structures of Interest Rates in Australia

27 Feb 2018 RDP 2018-02
Jonathan Hambur and Richard Finlay
financial markets, inflation, interest rates, modelling, money. We outline a ‘workhorse’ affine term structure model of nominal and real interest rates in Australia. ... At the same time, long-term inflation expectations have remained firmly within
https://www.rba.gov.au/publications/rdp/2018/2018-02.html

Robustness Checks

27 Feb 2018 RDP 2018-02
Jonathan Hambur and Richard Finlay
Both of these generalisations are potentially important given the sparsity of inflation-linked bonds. ... broad trends are still reasonably similar and the results still suggest that inflation expectations are well anchored within the 2 to 3 per cent
https://www.rba.gov.au/publications/rdp/2018/2018-02/robustness-checks.html

Conclusion

27 Feb 2018 RDP 2018-02
Jonathan Hambur and Richard Finlay
Meanwhile, longer-term inflation expectations have remained within the 2 to 3 per cent target band and have been more stable than suggested by other measures such as break-even inflation. ... The decline over the mid-to-late 1990s and early 2000s
https://www.rba.gov.au/publications/rdp/2018/2018-02/conclusion.html