Inflation and monetary policy: Argentina 2006-2011

Abstract

This article analyzes the causes of inflation in Argentina between 2006 and 2011, and the role
played by monetary policy in this evolution. The conceptual framework used emphasizes the real exchange rate and the relative price between tradable and non-tradable goods tradable; unlike the most frequent aggregate-based analyzes Monetary The conclusion reached, comparing the Argentine experience with that of other Latin American countries, is that the main cause of inflation was that the Central Bank did not induce currency revaluations during the expansionary periods They tended to appreciate the real exchange rate. Additionally, evidence is presented empirical to support the relationship (emphasized in the conceptual framework) between the type of real exchange and the relative price of tradable and non-tradable goods for Argentina. This evidence suggests that inflation experienced since 2006 was
mainly in non-tradable goods.