We study investors' perceptions of inflation through the lens of a high-frequency event study and document that they … have a stagflationary view of the world. In response to higher-than-expected inflation, investors expect firms' nominal … even decline, with increases in nominal yields offset by larger increases in inflation expectations. Consistent with a …

downward. These findings hold for both transaction-prices and regular-prices, and for both inflation and no-inflation periods. …

developments. We introduce a Taylor rule reacting to stock price growth rates along with inflation and output gap in a New …