The conventional wisdom that inflation expectations respond to the level of the price of oil (or the price of gasoline … price shocks may indeed drive one-year household inflation expectations. The model shows that there have been several such … episodes since 1990. In particular, the rise in household inflation expectations between 2009 and 2013 is almost entirely …

experiment of the past decade, stemming from a belief of the government that higher interest rates cause higher inflation … eventually a negative coefficient on inflation in the policy rule. In such an environment, was the exchange rate still a random … walk? Was inflation anchored? Does the "standard model" suffice to explain the broad contours of macroeconomic outcomes in …

interpreted, first and foremost, as a commitment device. In our setting, a monetary target helps anchoring inflation and inflation … well as a strong response to deviations of inflation from target and to the activity growth gap. In contrast, the response …

As inflation rates in the United States decline, analysts are asking if there are economic reasons to hold the rates at … levels above zero. Previous studies of whether inflation greases the wheels of the labor market ignore inflation's potential … allows the benefits of inflation (downward wage flexibility) to be separated from disruptive uncertainty about inflation rate …

interpreted, first and foremost, as a commitment device. In our setting, a monetary target helps anchoring inflation and inflation … well as a strong response to deviations of inflation from target and to the activity growth gap. In contrast, the response …

inflation and rising inflation expectations for years to come. We show that these concerns have been overstated. A $100 oil … scenario of the type discussed by many observers, would only briefly raise monthly headline inflation, before fading rather … quickly. However, the short-run effects on headline inflation would be sizable. For example, on a yearover-year basis …

pass-through of the price of crude oil or the price of motor gasoline to U.S. inflation. Neither approach accounts for the … headline and core CPI inflation. Our analysis confirms that focusing on gasoline price shocks alone will underestimate the … increase in headline inflation in 2021 and 2022 reflected non-energy price shocks. …

inflation targeter early in this period but began to pay less attention to inflation after 2009. Loss of the strong nominal … anchor is visible in the break we estimate in Taylor-type rules as well as in asset prices. We also argue that recent …

. Aggregating the model in closed form, we show that it delivers radically different predictions for the optimal inflation rate than … canonical sticky price models featuring homogenous Firms: (1) the optimal steady-state inflation rate generically differs from … zero and, (2) inflation optimally responds to productivity disturbances. Using micro data from the US Census Bureau to …

near-term economic outlook, characterised by persistently low nominal interest rates and inflation, and in a lasting low …