jetpack domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /mnt/stor08-wc1-ord1/694335/916773/www.tvhe.co.nz/web/content/wp-includes/functions.php on line 6131updraftplus domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /mnt/stor08-wc1-ord1/694335/916773/www.tvhe.co.nz/web/content/wp-includes/functions.php on line 6131avia_framework domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /mnt/stor08-wc1-ord1/694335/916773/www.tvhe.co.nz/web/content/wp-includes/functions.php on line 6131I think targeting NGDP futures is very similar to targeting expected inflation. However, there are a few costs and benefits.
Benefit:
Targeting the NGDP level provides more certainty about the price level and nominal activity in the future – giving certainty for investment.
Cost:
In the face of supply shocks, NGDP targeting leads to excessive loosening – keeping inflation at a higher level than is preferable.
In New Zealand:
In the New Zealand context, we are subject to constant supply shocks given our position as a small open economy – as a result, I feel the argument leans towards inflation targeting instead of NGDP targeting.
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