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About the Looming De-anchoring of Inflation Expectations in the Eurozone and the ECB’s Room for Maneuver

Author

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  • Sascha Möhrle
  • Timo Wollmershäuser

Abstract

For some time now, the inflation rate in the eurozone has stayed below the European Central Bank’s inflation target. Data from the Survey of Professional Forecasters shows that average inflation expectations have been revised significantly downwards in recent years, while at the same time the uncertainty surrounding these expectations has increased considerably. This paper discusses the reasons for the looming de-anchoring of inflation expectations and the ECB’s room for maneuver in the context of the coronavirus crisis.

Suggested Citation

  • Sascha Möhrle & Timo Wollmershäuser, 2020. "About the Looming De-anchoring of Inflation Expectations in the Eurozone and the ECB’s Room for Maneuver," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 73(10), pages 30-32, October.
    • Handle: RePEc:ces:ifosdt:v:73:y:2020:i:10:p:30-32
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    References listed on IDEAS

    as
    1. Lukasz Rachel & Thomas D. Smith, 2017. "Are Low Real Interest Rates Here to Stay?," International Journal of Central Banking, International Journal of Central Banking, vol. 13(3), pages 1-42, September.
    2. Boubaker, Sabri & Nguyen, Duc Khuong & Paltalidis, Nikos, 2018. "Fiscal policy interventions at the zero lower bound," Journal of Economic Dynamics and Control, Elsevier, vol. 93(C), pages 297-314.
    3. Roc Armenter, 2018. "The Perils of Nominal Targets," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 85(1), pages 50-86.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Inflationserwartung; Eurozone; EZB;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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