This paper decomposes the time-varying effect of exogenous exchange rate shocks on euro area countries inflation into … quarters of the past six years, especially in turning point periods. Our main results indicate that headline inflation in euro … inflation this increasing sensitivity is solely reliant on a sustained surge in the degree of comovement, for energy inflation …

We study the convergence properties of inflation rates among the countries of the European Monetary Union over the … and multivariate unit root tests on inflation differentials, arguing that the power of the tests is considerably increased … hypothesis over the period 1980-1997. We then investigate whether the second sub-sample is characterized by stable inflation …

. Our analysis improves upon existing work by endogenising the volatility of both output and inflation. Improved …

We use a joint model of macroeconomic and term structure dynamics to estimate inflation risk premia in the United … inflation and interest rate expectations at various future horizons, as well as term structure data from both nominal and index …-linked bonds. Our results show that, in both currency areas, inflation risk premia are relatively small, positive, and increasing …

qualitative and quantitative information on subsequent inflation. The usefulness of monetary analysis is contrasted to weaknesses … in modeling monetary policy and inflation with respectively short-term interest rates and real activity measures. The … analysis sheds light on the recent change in inflation volatility and persistence as well as on the Phillips curve flattening …

and food price shocks on a given set of countries. Secondly, we assess the importance of inflation linkages among … exist among regions. In addition, a considerable part of the observed headline inflation rises is attributable to foreign …

This paper tests whether the proposition that globalisation has led to greater sensitivity of domestic inflation to the … power for domestic consumer price inflation in the euro area. Based on these findings, the prescription that central banks …

This paper shows that inflation in industrialized countries is largely a global phenomenon. First, the inflation rates … variance share that is associated with Global Inflation is not only due to the trend components of inflation (up from 1960 to …. The co-movement of inflation comes largely from common shocks. Global Inflation is a function of real developments at …

credibility a pegged exchange rate regime yields a lower loss compared to an inflation targeting policy, even if this policy … for a policy-maker to adopt inflation targeting over a strict exchange rate targeting regime. Full credibility is not a … precondition, but exposure to foreign and financial shocks and high steady state inflation make joining the EMU relatively more …

This paper first shows that the forecast error incurred when assuming that future inflation will be equal to the … inflation target announced by the central bank is typically at least as small and often smaller than forecast errors of model …-based and published inflation forecasts. It then shows that there are substantial benefits in having rule-of-thumb agents who …