about 20 basis points over a fouryear transition period. Monetary policy faces a tradeoff: pursuing a strict inflation … durables. We propose a New Keynesian model that features both, "brown" and "green" durable goods and show that if monetary … policy follows a business-as-usual approach, the green transition will be inflationary, with headline inflation increasing by …

to successfully conduct monetary policy. The objective of our study is to examine how this trust may change in response …