The Nepal Rastra Bank (NRB) pegs the Nepalese rupee to the Indian rupee, meaning that the NRB effectively transfers control over the country’s monetary policy to India. It is therefore argued that Indian inflation causes Nepalese inflation. This study investigates whether the NRB should have instead floated the Nepalese rupee and targeted inflation. For this purpose, a dynamic stochastic general equilibrium (DSGE) model under a fixed exchange rate regime is estimated using Nepalese data during the 1993–2016 period. The estimated model is used for simulations under counterfactual scenarios for which the NRB floated the Nepalese rupee and followed a rule to target inflation during the study period. Findings show that inflation targeting would have significantly increased the welfare cost associated with business cycles to risk-averse household, owing to interest-rate volatility. The volatilities of consumption and labour services would have become larger.

JEL Classification: E31, E32, E52, F41, F45

尼泊尔拉斯特拉银行（NRB）将尼泊尔卢比与印度卢比挂钩，这意味着尼泊尔央行将对印度货币政策的控制权有效转移给了印度。因此，有人认为印度的通货膨胀会导致尼泊尔的通货膨胀。这项研究调查了NRB是否应该改为浮动尼泊尔卢比和有针对性的通货膨胀。为此，使用尼泊尔在1993–2016年期间的数据估算了固定汇率制度下的动态随机一般均衡（DSGE）模型。估计的模型用于反事实情景下的模拟，在这种情况下，NRB浮动尼泊尔卢比，并在研究期间遵循针对通货膨胀的规则。研究结果表明，针对通货膨胀的目标会大大增加与厌恶风险的家庭的商业周期相关的福利成本，由于利率波动。消费和劳动力服务的波动性将会变得更大。

JEL分类： E31，E32，E52，F41，F45