O'Grady, TD;
Macallan, C;
Taylor, T;
(2011)
Assessing the risk to inflation from inflation expectations.
Bank of England Quarterly Bulletin
, 51
(2)
pp. 100-110.
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Abstract
Inflation expectations play an important role in the transmission mechanism of monetary policy. There is a risk that the periods of above-target CPI inflation in the past three years might cause inflation expectations to drift upwards. That might make inflation itself more persistent, via changes in price and wage-setting behaviour. And so, other things being equal, returning inflation to target would require tighter monetary policy. This article provides a framework that can be used to monitor the risk to inflation from inflation expectations. While recent developments provide few signs that the risk is materialising, the imperfect nature of data mean that the risk can be assessed only imperfectly.
| Type: | Article |
|---|---|
| Title: | Assessing the risk to inflation from inflation expectations |
| Open access status: | An open access version is available from UCL Discovery |
| Publisher version: | https://www.bankofengland.co.uk/-/media/boe/files/... |
| Language: | English |
| Additional information: | This version is the version of record. For information on re-use, please refer to the publisher’s terms and conditions. |
| URI: | https://discovery-pp.ucl.ac.uk/id/eprint/10053391 |
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