are now attempting to lower debt ratios. We analyze past debt reduction episodes and find inflation and the real interest … rare. Interestingly, inflation episodes tended to be with independent central banks and low real interest rates …

the tradeable sector. They also suggest that the sales destination matters: wage growth contributes to domestic inflation … for goods but not to export inflation. Finally, we also provide evidence of an increase in the wage-price pass …

Elevated inflation can threaten the credibility of central banks and increase the risk that inflation expectations do … not remain anchored. Wage-price spirals might develop in such an environment, and high inflation could become entrenched …-varying propagation of inflationary shocks that improves forecasting performance of inflation and wage growth. Central bank credibility is …