Monetary Policy Rule under an Inflation Targeting Framework: Evidence from Thailand


  • Kumpon Pornpattanapaisankul Faculty of Economics, Thammasat University


Taylor rule, Target inflation, Cointegration


This paper reviews the empirical evidence on the monetary policy of the Bank of  Thailand (BOT) under inflation targeting framework, using the Taylor rule as the base of the study. This paper also takes uncertainties associated with potential output in estimating output gap into consideration. The main findings from cointegration analysis report that the interest rate set by the BOT has performed the role of nominal anchor for the Thai economy. The results suggest that recent monetary policy in Thailand has been consistent with flexible inflation targeting principles. The evidence shows that, to reach the price stability goal, the BOT has directly targeted inflation rate rather than targeting exchange rates. Our results show that the Taylor rules with output data revisions provide different policy recommendations.


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How to Cite

Pornpattanapaisankul, K. (2018). Monetary Policy Rule under an Inflation Targeting Framework: Evidence from Thailand. Thailand and The World Economy, 28(3), 143–179. Retrieved from