Inflation target credibility in times of high inflation
Coleman W, Nautz D (2023)
Publication Type: Journal article
Publication year: 2023
Journal
Book Volume: 222
Article Number: 110930
DOI: 10.1016/j.econlet.2022.110930
Abstract
We use a representative online survey to investigate the inflation expectations of German consumers and the credibility of the ECB's inflation target during the recent high inflation period. We find that credibility has trended downwards since summer 2021, reaching an all-time low in April 2022. The high correlation between inflation expectations and the actual rate of inflation strongly indicate that inflation expectations have been de-anchored from the inflation target. With increasing inflation, German consumers are more convinced that – in contrast to the ECB's inflation target – inflation will be well above 2% over the medium term.
Involved external institutions
Germany (DE)How to cite
APA:
Coleman, W., & Nautz, D. (2023). Inflation target credibility in times of high inflation. Economics letters, 222. https://doi.org/10.1016/j.econlet.2022.110930
MLA:
Coleman, Winnie, and Dieter Nautz. "Inflation target credibility in times of high inflation." Economics letters 222 (2023).
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