To the list of articles28 december 2008
WP/08/10 Forecasting Inflation in the Context of the Transition to Inflation Targeting: the Role of the Output Gap Indicator
This paper examines the possibility of using the indicator of the output gap to forecast inflation in the context of the transition to inflation targeting regime in Belarus. It shows that the choice of the “best” measure of the output gap is not always justified. Despite the fact that there may be discrepancies in the interpretation of performance levels of the output gap calculated based on different methods, their dynamics, in most cases, are unidirectional. Therefore, the paper suggests the appropriateness of the use of different measures of the output gap.