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Economic Policy Objectives and Challenges in Tanzania
Economic Policy Objectives and Challenges in Tanzania

... Disclaimer The views expressed in this presentation are those of the authors only, and the presence of them, or of links to them, on the IMF website does not imply that the IMF, its Executive Board, or its management endorses or shares the views expressed in the presentation. ...
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Inflation targeting

Inflation targeting is a monetary policy in which a central bank has an explicit target inflation rate for the medium term and announces this inflation target to the public. The assumption is that the best that monetary policy can do to support long-term growth of the economy is to maintain price stability. The central bank uses interest rates, its main short-term monetary instrument.An inflation-targeting central bank will raise or lower interest rates based on above-target or below-target inflation, respectively. The conventional wisdom is that raising interest rates usually cools the economy to reign in inflation; lowering interest rates usually accelerates the economy, thereby boosting inflation.
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