Estimating SARB's Policy Reaction Rule

Alberto Ortiz, Federico Sturzenegger and Ashoka Mody

No 165, CID Working Papers from Center for International Development at Harvard University

Abstract: This paper uses a Dynamic Stochastic General Equilibrium (DSGE) model to estimate the South African Reserve Bank’s (SARB) policy reaction rule. We find that the SARB has a stable rule very much in line with those estimated for Canada, UK, Australia and New Zealand. Relative to other emerging economies the policy reaction function of the SARB appears to be much more stable with a consistent anti-inflation bias, a somewhat larger weight on output and a very low weight on the exchange rate.

Keywords: Monetary Policy Rules; Exchange Rates; Structural Estimation; Bayesian Analysis (search for similar items in EconPapers)
JEL-codes: C32 E52 F41 O57 (search for similar items in EconPapers)
Date: 2008-05
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Related works:
Journal Article: ESTIMATING SARB'S POLICY REACTION RULE (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:cid:wpfacu:165

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