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Does Money Matter for Inflation in Ghana? Arto Kovanen

Does Money Matter for Inflation in Ghana?

Arto Kovanen

Published November 1st 2011
ISBN : 9786613883186
ebook
25 pages
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 About the Book 

Money has only limited information value for future inflation in Ghana over a typical monetary policy implementation horizon (four to eight quarters). On the other hand, currency depreciation and demand pressures (as measured by the output gap) areMoreMoney has only limited information value for future inflation in Ghana over a typical monetary policy implementation horizon (four to eight quarters). On the other hand, currency depreciation and demand pressures (as measured by the output gap) are shown to be important predictors of future price changes. Inflation inertia is high and inflation expectations are largely based on backward-looking information, suggesting that inflation expectations are not well anchored and hence more is needed to strengthen the credibility of Ghanas inflation-targeting regime.1