01941cas a2200277 a 4500 AALejournalIMF016228 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513529738 1018-5941 BD-DhAAL BD-DhAAL Brandao-Marques, Luis. Monetary Policy Transmission in Emerging Markets and Developing Economies / Luis Brandao-Marques, R. Gelos, Thomas Harjes, Ratna Sahay. Washington, D.C. : International Monetary Fund, 2020. 1 online resource (54 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Central banks in emerging and developing economies (EMDEs) have been modernizing their monetary policy frameworks, often moving toward inflation targeting (IT). However, questions regarding the strength of monetary policy transmission from interest rates to inflation and output have often stalled progress. We conduct a novel empirical analysis using Jorda's (2005) approach for 40 EMDEs to shed a light on monetary transmission in these countries. We find that interest rate hikes reduce output growth and inflation, once we explicitly account for the behavior of the exchange rate. Having a modern monetary policy framework-adopting IT and independent and transparent central banks-matters more for monetary transmission than financial development. Mode of access: Internet Gelos, R. Harjes, Thomas. Sahay, Ratna. IMF Working Papers; Working Paper ; No. 2020/035 Full text available on IMF http://elibrary.imf.org/view/journals/001/2020/035/001.2020.issue-035-en.xml IMF e-Library