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. …

This paper provides a summary of current knowledge on inflation persistence and price stickiness in the euro area …, based on research findings that have been produced in the context of the Inflation Persistence Network. The main findings … are: i) Under the current monetary policy regime, the estimated degree of inflation persistence in the euro area is …

This paper aims to contribute to our understanding of inflation dynamics in the United Kingdom by estimating two …

I document the frequency and size of price adjustments using thirty years of monthly data covering both high- and low-inflation … periods. Prices increase more frequently in smaller amounts when inflation is high, and less frequently but in larger amounts … when inflation is low. A novel decomposition of the inflation rate shows that when inflation is high and volatile the …

) relation between price stickiness and inflation persistence. This has recently been put forward by Bils and Klenow (2004) as …

al., 2010) showing that a random walk dynamic component accounts for much of the persistence in inflation. I use a time …-dependent sticky price model and study the mapping from disturbances to the price reset hazard function to inflation dynamics. I show … of inflation …

We provide a new way to filter US inflation into trend and cycle components, based on extracting long-run forecasts …, then estimating parameters, and then extracting the stochastic trend in inflation. The trend-cycle model with unobserved … components is consistent with numerous studies of US inflation history and is of interest partly because the trend may be viewed …

changing prices frequently do so even under low inflation. What happens to price setting strategies of sticky price goods under … moderate inflation? We built a dataset of monthly newspaper and magazine prices for Colombia, for the period 1960-2005, an … exceptional example of prolonged moderate inflation. Within this macroeconomic scenario, and the novel database, we study the …

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 …