Ben Bernanke was on Tuesday appointed by the president of the United States to succeed Alan Greenspan at the helm of the central bank of the United States (Fed).
Bernanke, 51, is a renowned expert in monetary policy, primarily in inflation targeting. A former Princeton professor, he was part of the Fed governor board between August 2002-June 2005, when he moved to the White House and proved instrumental in the promotion of greater transparency with regard to the operations of the central bank. In March 2005, when the name of new Fed chief was not yet known, in order to define inflation targeting, governor Mugur Isarescu employed the monetary policy framework formally adopted by the NBR starting August - Bernanke''s formulation.
This inflation targeting policy has only recently emerged in Western schools of economic thinking.
"Although I see why it is difficult to define inflation targeting, I consider the definition given by Ben Bernanke as being the appropriate one. Accordingly, inflation targeting is ''a framework for monetary policy characterised by the public announcement of official quantitative targets (...) for the inflation rate over one or more time horizons, and by explicit acknowledgement that low, stable inflation is monetary policy''s primary long-run goal. Among other important features of inflation targeting are vigorous efforts to communicate with the public about the plans and objectives of the monetary authorities, and, in many cases, mechanisms that strengthen the central bank''s accountability for attaining these objectives.''" Isarescu explained at that time.
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