What can keep euro area inflation high?

Reis, Ricardo ORCID: 0000-0003-4844-9483 (2023) What can keep euro area inflation high? Economic Policy, 38 (115). 495 – 517. ISSN 0266-4658

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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:	12 Dec 2024 03:56
URI:	http://eprints.lse.ac.uk/id/eprint/120728

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