Inflation-Linked Bonds from a Central Bank Perspective

50 Pages Posted: 5 Jun 2007

See all articles by Juan A. Garcia

Juan A. Garcia

European Central Bank (ECB)

Adrian A. R. J. M. van Rixtel

European Central Bank (ECB)

Date Written: June 2007

Abstract

Inflation-linked bond markets have experienced significant growth in recent years. This growth is somewhat surprising, for inflation-linked bonds cannot be considered a financial innovation and their development has taken place in a period of historically low global inflation and inflation expectations. In this context, the purpose of this paper is twofold. First, it provides a selective survey of the key arguments for and against the issuance of inflation-linked debt, and some of the factors that help to understand their recent growth. Second, it illustrates the use of these instruments to better monitor investors' inflation expectations and growth prospects from a central bank perspective.

Suggested Citation

Garcia, Juan Angel and van Rixtel, Adrian A.R.J.M., Inflation-Linked Bonds from a Central Bank Perspective (June 2007). ECB Occasional Paper No. 62, Banco de España Research Paper No. OP-0705, Available at SSRN: https://ssrn.com/abstract=977352 or http://dx.doi.org/10.2139/ssrn.977352

Juan Angel Garcia (Contact Author)

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

Adrian A.R.J.M. van Rixtel

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

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