Inflation and Output Gap Forecasts

Inflation and Output Gap Forecasts

Output gap is an important monetary policy variable that can be used to gauge inflationary pressures. Under the inflation targeting regime, the CBRT sets its monetary policy instruments in light of inflation forecasts. Accordingly, a positive output gap points to inflationary pressures due to excess demand whereas a negative output gap points to disinflationary pressures stemming from excess capacity in the economy.

 

      Inflation and Output Gap Forecasts

Output Gap


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