persistent inflation. In response to business cycle shocks, the monetary authority controls inflation, and the fiscal authority … stabilizes debt. However, the central bank accommodates unfunded fiscal shocks, causing persistent movements in inflation, output …, and real interest rates. In an estimated quantitative model, fiscal inflation accounts for the bulk of inflation dynamics …

inflationary pressure. In this case, default and inflation risks can reinforce each other. …

-to-GDP ratio threatens US inflation stability. In response to business cycle shocks, the monetary authority controls inflation, and … in inflation and real interest rates, leading to a fiscal theory of trend inflation. Fiscal trend inflation accounts for … the bulk of inflation dynamics. The current situation is in line with historical experience. Unfunded shocks sustain the …

negative shock. The current low interest rate environment limits the tools the central bank can use to stabilize the economy … controlled rise of inflation to wear away a targeted fraction of debt. Under this coordinated strategy, the fiscal authority … increase in inflation to accommodate the emergency budget. In our model, the coordinated strategy enhances the efficacy of the …

Low and stable inflation requires an appropriate fiscal framework aimed at stabilizing government debt. Historically …, trend inflation is critically influenced by actual or perceived changes to this framework, while cost-push shocks only … account for short-lasting movements in inflation. Before the pandemic, a moderate level of fiscal inflation has counteracted …

controlled rise of inflation to wear away a targeted fraction of debt. Under this strategy, the fiscal authority introduces an … inflation to accommodate the emergency budget. In our model the coordinated strategy enhances the efficacy of the fiscal …-target inflation. This strategy results in only moderate levels of inflation by separating long-run fiscal sustainability from a short …

We document that about 33% of the core inflation basket in the euro area is sensitive to monetary policy shocks. We …. Estimations over different samples show that the impact of monetary policy shocks on sensitive core inflation has become larger …

that the boom was unusually long and associated with neither particularly strong growth nor rising inflation in the …