Working Paper

Monetary and exchange rate policy in Austria: an early example of policy coordination

Abstract: This paper describes the evolution of Austrian exchange rate and monetary policy as an example of the benefits of policy coordination and credibility. This policy proved the performance of the Central Bank in achieving its twin objective of stabilizing the internal and external value of the currency. In this process, policymakers have sought to exploit the advantages of credibility by building a reputation for sticking to their policy. The evidence presented exhibits the increased coordination between Austrian and German nominal aggregates in the course of time. These accomplishments have apparently not tequired tying the real performance of the Austrian economy to any adverse permanent real consequences of German monetary policy, in particular, to its inflation-unemployment trade off.

Keywords: Austria; Monetary policy - Austria;

Status: Published in Economic policy coordination in an integrating Europe (Bank of Finland, 1992)

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Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Working Papers

Publication Date: 1992

Number: 1992-005