Trend Inflation and Inflation Compensation.:

This paper incorporates market-based inflation expectations to the growing literature on trend inflation estimation, and finds that there has been a significant decline in euro area trend inflation since 2013. This finding is robust to using different measures of long-term inflation expectations in...

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Bibliographic Details
Main Authors: Garcia, Juan Angel (Author), Poon, Aubrey (Author)
Format: Electronic eBook
Language:English
Published: Washington, D.C. : International Monetary Fund, 2018.
Series:IMF Working Papers; Working Paper ; no. 18/154.
Subjects:
Online Access:DE-862
DE-863
Summary:This paper incorporates market-based inflation expectations to the growing literature on trend inflation estimation, and finds that there has been a significant decline in euro area trend inflation since 2013. This finding is robust to using different measures of long-term inflation expectations in the estimation, both market-based and surveys. That evidence: (i) supports the expansion of ECB's UMP measures since 2015; (ii) provides a metric to monitor long-term inflation expectations following their introduction, and the likelihood of a sustained return of inflation towards levels below, but close to, 2% over the medium term.
Physical Description:1 online resource (46 pages)
ISBN:148436788X
1484362403
9781484362402
9781484367889

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