Excess Money Growth and Inflation Dynamics
Abstract
This paper analyses the short-run impact of periods of strong monetary growth on inflation dynamics for 15 industrialized economies. We find that when robust money growth is accompanied by large increases in stock and house prices and loose credit conditions, the probability of recording an inflationary outburst over a three-year horizon is significantly increased. In contrast, significant money stock expansions that are not associated with sustained credit increases and strong dynamics in other asset prices seem to be less likely to have inflationary consequences and are thus less worrying from a policy perspective. Copyright 2007 Blackwell Publishing LtdDownload Info
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Bibliographic Info
Article provided by Wiley Blackwell in its journal International Finance.
Volume (Year): 10 (2007)
Issue (Month): 3 (December)
Pages: 241-280
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=1367-0271
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Related research
Keywords:Other versions of this item:
- Barbara Roffia & Andrea Zaghini, 2007. "Excess money growth and inflation dynamics," Working Paper Series 749, European Central Bank.
- Barbara Roffia & Andrea Zaghini, 2008. "Excess money growth and inflation dynamics," Temi di discussione (Economic working papers) 657, Bank of Italy, Economic Research and International Relations Area.
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
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- Joao Miguel Sousa & Andrea Zaghini, 2006. "Global Monetary Policy Shocks in the G5: A SVAR Approach," CFS Working Paper Series 2006/30, Center for Financial Studies.
- Joao Miguel Sousa & Andrea Zaghini, 2007. "Global Monetary Policy Shocks in the G5: a SVAR Approach," CEIS Research Paper 89, Tor Vergata University, CEIS.
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- Ansgar Belke & Walter Orth, 2007. "Global Excess Liquidity and House Prices - A VAR Analysis for OECD Countries," Ruhr Economic Papers 0037, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
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- Saumitra, Bhaduri & Raja, Sethudurai, 2012. "A note on excess money growth and inflation dynamics: evidence from threshold regression," MPRA Paper 38036, University Library of Munich, Germany.
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