Macroeconomics, 2nd Edition by Pearson

402

MACROECONOMICS

available only with a lag and even then the estimates of these variables are

revised in the period following their initial release. By contrast, interest rates,

money stock, and credit data are in hand for inspection and for use at any

given moment. By pursuing an intermediate target defined around such finan-

cial variables, the central bank can infer whether the eventual outcome for the

economy is in the direction of its eventual policy objectives rather than having

to wait to make such an assessment.

The choice of a macroeconomic variable, that is, to serve as an intermedi-

ate target is usually made on the basis ...