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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.

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Policy Implications

1 Feb 1998 RDP 9803
Gordon de Brouwer and Luci Ellis
future. This is perhaps one reason why many central banks in developed countries have adopted explicit inflation targets. ... It also underscores why central banks have placed particular emphasis on establishing the credibility of their inflation target
https://www.rba.gov.au/publications/rdp/1998/1998-03/policy-implications.html

Evidence on the Formation of Inflation Expectations

1 Feb 1998 RDP 9803
Gordon de Brouwer and Luci Ellis
It is worth observing that while this measure of inflation expectations is currently around 2 to 3 per cent, the Australian inflation target is expressed in terms of a medium-term ... Given that the inflation target is a medium-term mean, short-term
https://www.rba.gov.au/publications/rdp/1998/1998-03/evidence-on-the-formation-of-inflation-expectations.html

References

1 Feb 1998 RDP 9803
Gordon de Brouwer and Luci Ellis
6157. Black, R., T. Macklem and D. Rose (1997), ‘On Policy Rules for Price Stability’, paper presented at the Bank of Canada Conference, Price Stability, Inflation Targets and Monetary Policy, ... 9702. Haldane, A.G. (1997), ‘Designing Inflation
https://www.rba.gov.au/publications/rdp/1998/1998-03/references.html

Conclusions

1 Feb 1998 RDP 9803
Gordon de Brouwer and Luci Ellis
For example, if people think that the central bank will accommodate inflation shocks, but the central bank in fact does not do so (which is the case of an inflation target ... with no credibility), then inflation is still tied to the target in the medium
https://www.rba.gov.au/publications/rdp/1998/1998-03/conclusions.html

Introduction

1 Feb 1998 RDP 9803
Gordon de Brouwer and Luci Ellis
We start by examining the ‘rationality’ of inflation expectations as measured by surveys of financial market economists and households. ... We look, first, at forward-looking monetary policy. Forward-looking policy reduces the variability of
https://www.rba.gov.au/publications/rdp/1998/1998-03/introduction.html