Global Supply Chain Inflationary Pressures and Monetary Policy in Mexico
This paper examines the impact of stress in the global supply chain on inflation and monetary policy in Mexico, a representative emerging market economy. Using non-linear local projections, the degree of monetary policy tightening required in a high-stress supply chain environment is estimated. Results suggest that in this enviroment, an increase in the monetary policy interest rate affects inflation over a 2-year period by less than half. Raising the interest rate affects producer price inflation, an absetn channel in a low-stress regime. This highlights monetary policy challenges in stabilizing inflation when facing supply shocks
Year of publication: |
[2023]
|
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Authors: | Hernandez, Juan R. ; Ventosa-Santàularia, Daniel ; Valencia, J. Eduardo |
Publisher: |
[S.l.] : SSRN |
Subject: | Lieferkette | Supply chain | Mexiko | Mexico | Geldpolitik | Monetary policy | Inflation |
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