-type staggered price setting approach, which means that the adjustment of the aggregate loan rate to a monetary policy shock is … inflation is driven by real unit labor costs rather than the loan rate. Our main conclusion is that the strength of the cost …

-type staggered price setting approach, which means that the adjustment of the aggregate loan rate to a monetary policy shock is … inflation is driven by real unit labor costs rather than the loan rate. Our main conclusion is that the strength of the cost …

-type staggered price setting approach, which means that the adjustment of the aggregate loan rate to a monetary policy shock is … inflation is driven by real unit labor costs rather than the loan rate. Our main conclusion is that the strength of the cost …

shocks. The single central bank implements the optimal discretionary monetary policy by setting the union interest rate …

, under discretion, the central bank has to be sufficiently inflation averse for the equilibrium to have these properties …

exchange rate and the price level if a central bank implements an inflation target by means of a traditional Taylor rule. These … level to a temporary risk premium shock are larger and more persistent when the ZLB is binding. Our theoretical discussion …

output and inflation in opposite directions may worsen the trade-off for a central bank with a dual mandate. …