Verðbólguáætlun

Verðbólguáætlun refers to an inflation targeting strategy employed by central banks. It is a monetary policy framework where the central bank publicly commits to achieving a specific inflation rate over a defined period. The primary goal of verðbólguáætlun is to anchor inflation expectations and provide clarity to the public and financial markets about the central bank's commitment to price stability.

Under this framework, the central bank typically sets an explicit inflation target, often around 2%. If inflation deviates from this target, the central bank adjusts its monetary policy tools, such as interest rates, to steer inflation back towards the desired level. For example, if inflation is too high, the central bank might raise interest rates to cool down economic activity and reduce price pressures. Conversely, if inflation is too low, interest rates might be lowered to stimulate the economy.

The effectiveness of verðbólguáætlun relies on the central bank's credibility. This means that the public must believe the central bank has the will and the tools to achieve its inflation target. A credible central bank can influence inflation expectations, making it easier to manage actual inflation. Verðbólguáætlun aims to enhance transparency and accountability in monetary policy decision-making.