central banks target inflation at a rate of about 2 percent. Many economists have recently proposed even higher inflation … importance of appropriately accounting for a low, positive trend inflation rate for the conduct of monetary policy. We first … review empirical research on the evolution and dynamics of U.S. trend inflation, as well as some proposed new measures to …

We show that low trend inflation strongly affects the dynamics of a standard Neo-Keynesian model where monetary policy … is described by a standard Taylor rule. Moreover, trend inflation enlarges the indeterminacy region in the parameter … cannot disregard average inflation in both theoretical and empirical analysis. …

model indexation regulates the sources of inflation persistence. When indexation is zero, the inflation gap is purely … forward- looking and inflation persistence depends only on the level of trend inflation, while full indexation makes the … inflation gap persistent and it eliminates the effects of trend inflation. We show that in the former case the optimal policy is …

-run relationship between inflation and output is positive in the Rotemberg model and negative in the Calvo model. ii) The log …) The responses of output and inflation to a positive technology shock are amplified by trend inflation in Calvo, while they … inflation enlarges the determinacy region in the Rotemberg model, while it shrinks the determinacy region in the Calvo model. iv …

Even low levels of trend inflation substantially affect the dynamics of a basic new Keynesian DSGE model when monetary … policy is conducted by a contemporaneous Taylor rule. Positive trend inflation shrinks the determinacy region. Neither the … Taylor principle, which requires the inflation coefficient to be greater than one, nor the generalized Taylor principle …

Most macroeconomic models for monetary policy analysis are approximated around a zero-inflation steady state, but most … central banks target inflation at a rate of about 2 percent. Many economists have recently proposed even higher inflation … importance of appropriately accounting for a low, positive trend inflation rate for the conduct of monetary policy. We first …

Even low levels of trend inflation substantially affect the dynamics of a basic new Keynesian DSGE model when monetary … policy is conducted by a contemporaneous Taylor rule. Positive trend inflation shrinks the determinacy region. Neither the … Taylor principle, which requires the inflation coefficient to be greater than one, nor the generalized Taylor principle …

Since 2000 U.S. inflation has remained both below target and silent to domestic slack and monetary interventions. A … inflation. The trend analysis shows that, starting from the '90s, despite very well-anchored expectations, slow-moving imported … "cost-push" factors induced deflationary pressure keeping trend inflation below target. The cycle block provides evidence in …

effects on optimal monetary policy and the dynamics of inflation, output, and interest rates. Under discretion, the efficient …In the monetary policy literature it is commonly assumed that trend inflation is zero, despite overwhelming evidence … that zero inflation is neither empirically relevant nor a practical objective for central bank policy. We therefore extend …

Since 2000 U.S. inflation has remained both below target and silent to domestic slack and monetary interventions. A … inflation. The trend analysis shows that, starting from the `90s, despite very well-anchored expectations, slow-moving imported … "cost-push" factors induced deflationary pressure keeping trend inflation below target. The cycle block provides evidence in …