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What can keep euro area inflation high?

Reis, Ricardo (2023) What can keep euro area inflation high? Economic Policy, 38 (115). 495 – 517. ISSN 0266-4658

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Identification Number: 10.1093/epolic/eiad029

Abstract

A central bank that faces inflation above target may fail to bring it down. This article discusses six ways in which this happens because the central bank is dominated by: misjudgment, expectations, fiscal policy, financial markets, recession fears, or external forces. It applies this approach to the challenge facing the ECB in 2023-24. The hope is that the factors identified can serve as warning signs for what to avoid.

Item Type: Article
Additional Information: © 2023 The Author
Divisions: Economics
Subjects: H Social Sciences > HB Economic Theory
JEL classification: E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E58 - Central Banks and Their Policies
E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E50 - General
E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E31 - Price Level; Inflation; Deflation
Date Deposited: 13 Nov 2023 17:39
Last Modified: 15 Sep 2024 01:00
URI: http://eprints.lse.ac.uk/id/eprint/120728

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