The business cycle is alive and well, and real variables respond to it more or less as they always did. Witness the … an estimated DSGE model. It finds that the disconnect is due primarily to the muted reaction of inflation to cost … inflation stabilization also appears to have played some role by reducing the impact of demand shocks on the real economy. The …

Inflation in the euro area has been falling since mid-2013, turned negative at the end of 2014 and remained below … by means of sign restrictions, to inflation and economic activity. Shocks to oil supply do not tell the full story about … contractionary. A country analysis confirms that the negative effects of oil supply and monetary policy shocks on inflation was …

In order to explain the joint fluctuations of output, inflation and the labor market, this paper first develops a … helps to explain the sluggishness of inflation and the persistence of output after a monetary policy shock. The ability of … the model to account for the joint dynamics of output and inflation rely on its ability to explain the dynamics in the …

We compare supermarket price setting in the US and the euro area and assess its impact on food inflation. We introduce … flexibility of supermarket inflation in the US relative to the euro area. We argue that the driving force behind both factors is … by a mildly state-dependent price-setting model, and they jointly explain over a third of the difference in food-inflation …

, subsequently, we didn't see the inflation they predicted. We show that these puzzles disappear in a Vector Autoregressive model … much of the inflation dynamics in the 2012-2014 euro area missing inflation episode. Consequently, economists and models … that excessively focused on the global nature of inflation were liable to miss the contribution of deflationary domestic …

We develop a theoretical model that features a business cycle-dependent relation between out- put, price inflation and … inflation expectations, augmenting the model by Svensson (1997) with a nonlinear Phillips curve that reflects the rationale … pronounced convex relationship between inflation and the output gap, meaning that the coefficient in the Phillips curve on the …

important determinants of inflation over the sample. We then forecast core inflation 12 quarters ahead and present its … manner, the convergence towards a sustainable path of inflation. …