We examine consumption and commercial lending rates evolution, identifying the main determinants of their movements. Our objective is to distinguish effects related to monetary policy rate from those due to higher risk; this is done through counterfactual simulations around relevant variables....

Inflation targeting central banks usually base their objectives on headline inflation, which is often affected by price movements of specific components whose behavior makes it difficult to extract clear signals about the inflationary outlook relevant for the monetary policy horizon. For this...