We study the relation between inflation and real activity over the business cycle. We employ a Trend-Cycle VAR model to … control for low-frequency movements in inflation, unemployment, and growth that are pervasive in the post-WWII period. We show … that cyclical fluctuations of inflation are related to cyclical movements in real activity and unemployment, in line with …

Amidst the recent resurgence of inflation, this paper investigates the interplay of corporate profits and income … distribution in shaping inflation and aggregate demand within the New Keynesian framework. We derive a novel analytical condition …-demand fluctuations and inflation to be amplified by heterogeneity, profits have to be countercyclical--an implication that is at odds …

We derive closed-form solutions and sufficient statistics for inflation and GDP dynamics in multi-sector New Keynesian … of inflation and GDP responses to monetary and sectoral shocks and (2) increase the pass-through of sectoral shocks to … aggregate inflation. Quantitatively, we confirm the significant role of production networks in shock propagation, emphasizing …

inflation, building on our earlier work for the United States. Globally, as in the United States, pandemic-era inflation was due … bank inflation targets. As the effects of supply shocks have subsided, tight labor markets, and the rises in nominal wages …, have become relatively more important sources of inflation in many countries. In several countries, including the United …

We provide theory and evidence that relative price shocks can cause aggregate inflation and act as aggregate supply … on U.S. core inflation while depressing U.S. real activity. In a two-sector monetary model with upstream and downstream … predictions. Motivated by post-COVID inflation in the U.S., a model experiment shows that a one-time relative price shock …

Post-covid inflation was predominantly driven by unexpectedly strong demand forces, not only in the United States, but … inflation near its 2-percent target---would have severely hampered an already anaemic recovery …