Inflation targeting and inflation persistence in Asia-Pacific

► The literature is ambiguous about the effects of IT in emerging economies. ► It is possible for the average inflation rate to be close to target, but deviations of inflation may nevertheless be large and protracted. Thus, the persistence of shocks to inflation matters also at low levels of inflation. We therefore use an alternative metric of success and study how persistent shocks to inflation are. ► We find a significant reduction in inflation persistence following the adoption of inflation targeting. ► Measuring the performance of monetary policy strategies in terms of inflation persistence rather than the level of inflation tends to show that inflation targeting performs better than alternative strategies.