inflation immediately, but affects realized inflation with a lag. When I estimate the standard VAR model encompassed in the … forecast-augmented model, I find that a contractionary policy shock raises the inflation rate and leads to a gradual … appreciation of the domestic currency. However, the inclusion of inflation expectations reverses this puzzling response of the …

quantitative theory consistent with these empirical observations, banks' lending market power is determined in equilibrium and is a … novel channel of monetary policy. At low inflation, banks tend to extract higher markups from existing loan customers rather … than competing for additional loans. As a result, banking activity need not be welfare-improving if inflation is …

inflation are persistent too. We examine this prediction for a panel of countries. The standard CCAPM with power utility is …