ISSN: 2222-6990
Open access
In this paper we estimated the reaction function of the Central Bank of Romania during the last ten years. Using targeting rules of the type proposed by Clarida, Gali, Gertler (1998a, 1998b) we model the evolution of interest rate in this period. Using Generalized Method of Moments estimation we found out a strong relationship between interest rate, output-gap and inflation rate.
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Copyright: © 2018 The Author(s)
Published by Human Resource Management Academic Research Society (www.hrmars.com)
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