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Economic Commentary

A Price Objective for Monetary Policy

The idea of monetary policy aimed at producing a stable price level has gained increasing support in the United States in recent years. In 1991, the Neal Resolution proposed to make such a policy objective law. Elsewhere, the notion of price stability has also become more popular. For example, the central banks of Canada and New Zealand recently adopted explicit multiyear targets for inflation, and a commitment to price stability is widely thought to be a necessary condition for successful monetary union in the European Community.

The views authors express in Economic Commentary are theirs and not necessarily those of the Federal Reserve Bank of Cleveland or the Board of Governors of the Federal Reserve System. The series editor is Tasia Hane. This paper and its data are subject to revision; please visit for updates.

Suggested Citation

Gavin, William T., and Alan Stockman. 1992. “A Price Objective for Monetary Policy.” Federal Reserve Bank of Cleveland, Economic Commentary 4/1/1992.

This work by Federal Reserve Bank of Cleveland is licensed under Creative Commons Attribution-NonCommercial 4.0 International