Trend Inflation and Inflation Compensation

Poon, Aubrey and Garcia, Juan Angel (2018) Trend Inflation and Inflation Compensation. Preprint / Working Paper. International Monetary Fund, Washington D.C.. (https://www.imf.org/en/Publications/WP/Issues/2018...)

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Abstract

This paper incorporates market-based inflation expectations to the growing literature on trend inflation estimation, and finds that there has been a significant decline in euro area trend inflation since 2013. This finding is robust to using different measures of long-term inflation expectations in the estimation, both market-based and surveys. That evidence:(i) supports the expansion of ECB’s UMP measures since 2015;(ii) provides a metric to monitor long-term inflation expectations following their introduction, and the likelihood of a sustained return of inflation towards levels below but close to 2% over the medium term.

ORCID iDs

Poon, Aubrey ORCID logoORCID: https://orcid.org/0000-0003-2587-8779 and Garcia, Juan Angel;
  • Item type:Monograph(Preprint / Working Paper)
    ID code:65734
    Dates:
    Date
    Event
    30 June 2018
    Published
    Notes:IMF Working Paper No. WP/18/154
    Subjects:Social Sciences > Economic Theory
    Department:Strathclyde Business School > Economics
    Depositing user: Pure Administrator
    Date deposited:11 Oct 2018 08:47
    Last modified:11 Nov 2024 16:03
    URI:https://strathprints.strath.ac.uk/id/eprint/65734
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