Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests
Autor(a) principal: | |
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Data de Publicação: | 2018 |
Outros Autores: | |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Institucional da UFRGS |
Texto Completo: | http://hdl.handle.net/10183/201227 |
Resumo: | Brazil has had, since the middle 1990s, one of the highest real interest rates in the world, yet not one of the lowest inflation rates. By the end of that decade, an inflation targeting regime (ITR) was introduced. Real interest rates have remained extremely high for international standards, while macroeconomic performance has been dismal on the same grounds. This article argues that these results can be explained by, among others reasons, pressures from the rentiers to frame monetary policy in a way to sustain very high interest earnings in a context where inflation is not very sensitive to monetary policy instruments. Under the ITR, the interest rate seems to have been kept above what would be required to maintain low inflation under normal conditions (even if one assumes a demand-pull inflation, which is not necessarily the case), with a potentially negative impact on growth and employment. This is interpreted as an indicator of monetary policy ineffectiveness. On the empirical ground, this article compares interest rate, inflation, unemployment, and real output growth for Brazil with both ITR and non-ITR countries selected by judgment sampling. |
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Ferrari Filho, FernandoMilan, Marcelo2019-11-02T03:51:10Z20182332-7308http://hdl.handle.net/10183/201227001086427Brazil has had, since the middle 1990s, one of the highest real interest rates in the world, yet not one of the lowest inflation rates. By the end of that decade, an inflation targeting regime (ITR) was introduced. Real interest rates have remained extremely high for international standards, while macroeconomic performance has been dismal on the same grounds. This article argues that these results can be explained by, among others reasons, pressures from the rentiers to frame monetary policy in a way to sustain very high interest earnings in a context where inflation is not very sensitive to monetary policy instruments. Under the ITR, the interest rate seems to have been kept above what would be required to maintain low inflation under normal conditions (even if one assumes a demand-pull inflation, which is not necessarily the case), with a potentially negative impact on growth and employment. This is interpreted as an indicator of monetary policy ineffectiveness. On the empirical ground, this article compares interest rate, inflation, unemployment, and real output growth for Brazil with both ITR and non-ITR countries selected by judgment sampling.application/pdfengApplied Economics and Finance. Beaverton, USA. Vol. 5, n.6 (Nov. 2018), p. 84-100Política monetáriaInflaçãoTaxa de jurosExcess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interestsEstrangeiroinfo:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/openAccessreponame:Repositório Institucional da UFRGSinstname:Universidade Federal do Rio Grande do Sul (UFRGS)instacron:UFRGSTEXT001086427.pdf.txt001086427.pdf.txtExtracted Texttext/plain75609http://www.lume.ufrgs.br/bitstream/10183/201227/2/001086427.pdf.txt46353b285a6544b42d89c1a86f8c5c49MD52ORIGINAL001086427.pdfTexto completo (inglês)application/pdf573467http://www.lume.ufrgs.br/bitstream/10183/201227/1/001086427.pdf770fdecd0c958c30c7ffadb3d82ba92bMD5110183/2012272021-05-07 04:36:49.815836oai:www.lume.ufrgs.br:10183/201227Repositório de PublicaçõesPUBhttps://lume.ufrgs.br/oai/requestopendoar:2021-05-07T07:36:49Repositório Institucional da UFRGS - Universidade Federal do Rio Grande do Sul (UFRGS)false |
dc.title.pt_BR.fl_str_mv |
Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests |
title |
Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests |
spellingShingle |
Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests Ferrari Filho, Fernando Política monetária Inflação Taxa de juros |
title_short |
Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests |
title_full |
Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests |
title_fullStr |
Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests |
title_full_unstemmed |
Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests |
title_sort |
Excess real interest rates and the inflation targeting regime in Brazil : monetary policy ineffectiveness and rentiers‟ interests |
author |
Ferrari Filho, Fernando |
author_facet |
Ferrari Filho, Fernando Milan, Marcelo |
author_role |
author |
author2 |
Milan, Marcelo |
author2_role |
author |
dc.contributor.author.fl_str_mv |
Ferrari Filho, Fernando Milan, Marcelo |
dc.subject.por.fl_str_mv |
Política monetária Inflação Taxa de juros |
topic |
Política monetária Inflação Taxa de juros |
description |
Brazil has had, since the middle 1990s, one of the highest real interest rates in the world, yet not one of the lowest inflation rates. By the end of that decade, an inflation targeting regime (ITR) was introduced. Real interest rates have remained extremely high for international standards, while macroeconomic performance has been dismal on the same grounds. This article argues that these results can be explained by, among others reasons, pressures from the rentiers to frame monetary policy in a way to sustain very high interest earnings in a context where inflation is not very sensitive to monetary policy instruments. Under the ITR, the interest rate seems to have been kept above what would be required to maintain low inflation under normal conditions (even if one assumes a demand-pull inflation, which is not necessarily the case), with a potentially negative impact on growth and employment. This is interpreted as an indicator of monetary policy ineffectiveness. On the empirical ground, this article compares interest rate, inflation, unemployment, and real output growth for Brazil with both ITR and non-ITR countries selected by judgment sampling. |
publishDate |
2018 |
dc.date.issued.fl_str_mv |
2018 |
dc.date.accessioned.fl_str_mv |
2019-11-02T03:51:10Z |
dc.type.driver.fl_str_mv |
Estrangeiro info:eu-repo/semantics/article |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
format |
article |
status_str |
publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10183/201227 |
dc.identifier.issn.pt_BR.fl_str_mv |
2332-7308 |
dc.identifier.nrb.pt_BR.fl_str_mv |
001086427 |
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url |
http://hdl.handle.net/10183/201227 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.relation.ispartof.pt_BR.fl_str_mv |
Applied Economics and Finance. Beaverton, USA. Vol. 5, n.6 (Nov. 2018), p. 84-100 |
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info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
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application/pdf |
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