IMF Working Papers

Structural Quarterly Projection Model for Belarus

By Karel Musil, Mikhail Pranovich, Jan Vlcek

December 7, 2018

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Karel Musil, Mikhail Pranovich, and Jan Vlcek. Structural Quarterly Projection Model for Belarus, (USA: International Monetary Fund, 2018) accessed November 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Belarusian authorities contemplate transiting to inflation targeting. The paper suggests a small structural model at the core of the forecasting and policy analysis system. A well-researched canonical structure of Berg, A., Karam, P. and D. Laxton (2006) is extended to capture specifics of Belarusian economy and macroeconomic policy. The modified model’s policy block reflects a monetary targeting regime and allows for transition from it to an interest-rate-based framework. Adding wages, directed lending and dollarization allow for studying implications of activist wage policy, state program lending, and dollarization for macroeconomic stability and the strength of the policy transmission mechanism.

Subject: Demand for money, Exchange rates, Foreign exchange, Inflation, Inflation targeting, Monetary policy, Money, Output gap, Prices, Production

Keywords: Belarus, Changes monetary policy strategy, Core inflation, Demand for money, Depreciation shock, Depreciation target, Dollarization, Exchange rates, Fiscal Impulse, Inflation, Inflation targeting, Monetary Policy, Nominal exchange rate depreciation, Nominal Wages, Output gap, Quarterly Projection Model, Transmission mechanism, WP

Publication Details

  • Pages:

    41

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2018/254

  • Stock No:

    WPIEA2018254

  • ISBN:

    9781484385616

  • ISSN:

    1018-5941

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