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Exchange rate shocks and inflation comovement in the euro area
Leiva-Leon, Danilo; Martínez-Martín, Jaime; Ortega, Eva - 2020
This paper decomposes the time-varying effect of exogenous exchange rate shocks on euro area countries in ation into country-specific (idiosyncratic) and region-wide (common) components. To do so, we propose a exible empirical framework based on dynamic factor models subject to drifting...
Persistent link: https://www.econbiz.de/10012181317
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Communication and exchange rate policy
Fratzscher, Marcel - 2004
This paper deals with the very short-term influence of "oral interventions" on the exchange rate of major currencies. The paper finds that official communication, as reported by wire services, are effective in influencing the US dollar-euro and yen-US dollar exchange rates in the desired...
Persistent link: https://www.econbiz.de/10009639417
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Inflation persistence and robust monetary policy design
Coenen, Günter - 2003
This paper investigates the performance of optimised interest rate rules when there is uncertainty about a key determinant of the monetary transmission mechanism, namely the degree of persistence characterising the inflation process. The paper focuses on the euro area and utilises two variants of...
Persistent link: https://www.econbiz.de/10009635885
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Relevant economic issues concerning the optimal rate of inflation
Rodriguez-Palenzuela, Diego; Camba-Mendez, Gonzalo; … - 2003
This paper reviews the key economic issues concerning the welfare costs of inflation and deflation, with a view to … shedding light on the desirable properties of the inflation process. Our review of the evidence on the overall costs of … inflation and deflation indicates that such costs could be even higher than previously thought, also at moderate rates of …
Persistent link: https://www.econbiz.de/10009635897
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Downward nominal wage rigidity and the long-run Philips Curve
Coenen, Günter - 2003
the determination of inflation and output in the euro area and the existence of a non-vertical long-run Phillips curve …
Persistent link: https://www.econbiz.de/10009635901
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Inflation targets and the liquidity trap
Klaeffling, Matt; Perez, Victor Lopez - 2003
The presence of a lower bound of zero on nominal interest rates has important implications for the conduct of optimal monetary policy. Standard rational expectations models can have alternative steady states as well as non-unique laws of motion, i.e. there can be possible sunspot equilibria....
Persistent link: https://www.econbiz.de/10009635903
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Definition of price stability, range and point inflation targets
Castelnuovo, Efrem; Nicoletti-Altimari, Sergio; … - 2003
help anchoring inflation expectations. We use survey data on long-term inflation expectations in 15 industrial countries … since the early nineties to investigate how well anchored are inflation expectations. We find that in all countries except … Japan long-term inflation expectations are well anchored and, generally, increasingly so over the past decade. When …
Persistent link: https://www.econbiz.de/10009635904
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Zero lower bound
Coenen, Günter - 2003
such as the shortterm nominal interest rate, annual inflation and output. …
Persistent link: https://www.econbiz.de/10009635906
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Price stability and monetary policy effectiveness when nominal interest rates are bounded at zero
Coenen, Günter; Orphanides, Athanasios; Wieland, Volker - 2003
target inflation rates as low as 2 percent. However, the effects of the constraint are non-linear with respect to the inflation … percent. The variability of output increases significantly and that of inflation also rises somewhat. Also, we show that the … increasingly short of potential with lower inflation targets. …
Persistent link: https://www.econbiz.de/10009635983
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Exchange-rate policy and the zero bound on nominal interest rates
Coenen, Günter; Wieland, Volker - 2004
In this paper, we study the effectiveness of monetary policy in a severe recession and deflation when nominal interest rates are bounded at zero. We compare two alternative proposals for ameliorating the effect of the zero bound: an exchange-rate peg and price-level targeting. We conduct this...
Persistent link: https://www.econbiz.de/10009639404