In this paper, the interaction between inflation and monetary policy rules is analysed within the framework of a … illustrated that the control of monetary policy over the inflation process is strongly dependent on the role of forward looking …

data revision errors in GDP on the ex ante or conditional inflation-output-growth volatility trade-off and applies it to … volatility of inflation and output growth is explored by a simulation exercise. In general, the results obtained suggest that … focusing monetary policy on GDP growth instead on inflation may lead to an inefficient policy with both increased medium term …

-Wouters model and its forecasts of real GDP growth and inflation are compared with those from two extensions. The first adds … extensions improve the density forecasts of real GDP and inflation and their joint forecasts up to an eight-quarter horizon. We … find that adding financial frictions leads to a deterioration in the forecasts, with the exception of longer-term inflation …