Abstract
Discussion of “Swiss Monetary Policy 2000–2009” by Hans Genberg and Stefan Gerlach
Highlights
Hans Genberg and Stefan Gerlach provide a very nice description of the Swiss National Bank’s operating experience with the New Monetary Policy Framework for the period 2000 to 2009
Our comment is structured as follows: In the second part, we summarise the main contents of GG’s paper[1] and single out the following two results[2] which relate to the inflation forecast: (R3) states that the inflation forecast is not a good statistic of the SNB’s view of the future inflation. (R4) states that the SNB does not react primarily to its published inflation forecast
The authors underline two elements of flexibility built into the NMPF: The definition of price stability as a range, and the lack of a commitment to bring inflation back into this range within a specific time period
Summary
Hans Genberg and Stefan Gerlach (hereafter GG) provide a very nice description of the Swiss National Bank’s operating experience with the New Monetary Policy Framework (hereafter NMPF) for the period 2000 to 2009. We agree with most of the results of their paper, we have the feeling that the role of the inflation forecast has not been fully appreciated. This comment will focus on GG’s understanding of the role of the inflation forecast in the NMPF and present complementary material on this topic. Our comment is structured as follows: In the second part, we summarise the main contents of GG’s paper[1] and single out the following two results[2] which relate to the inflation forecast: (R3) states that the inflation forecast is not a good statistic of the SNB’s view of the future inflation.
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