Journal Article

Monetary policy in pre-ECB Italy

Abstract: In 1979, Italy entered into the Exchange Rate Mechanism (ERM) as a founding member of the European Monetary System. After that date, the country's monetary policy was geared toward the maintenance of exchange rate stability against its ERM partners, despite a number of exchange parity realignments and with the exception of the period from September 1992 to November 1996. The strength of the ERM commitment was not uniform over time, either in terms of amplitude of the fluctuation band or in terms of frequency of realignment of bilateral parities. Despite this variability, however, changes in official rates-the discount rate and the rate on fixed term advances-were overwhelmingly linked throughout the ERM period to developments in foreign exchange markets.

Keywords: Monetary policy - Italy; Banks and banking, Central - Italy; Bank of Italy;

Bibliographic Information

Provider: Federal Reserve Bank of Boston

Part of Series: New England Economic Review

Publication Date: 2002

Issue: Q 2

Pages: 35-38