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Inflation expectations, uncertainty, the Phillips Curve, and monetary policy

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  • Michael T. Kiley

Abstract

Inflation expectations play a central role in models of the Phillips curve. At long time horizons inflation expectations may reflect the credibility of a monetary authority's commitment to price stability. These observations highlight the importance of inflation expectations for monetary policy. These comments touch on three issues regarding inflation expectations: The evolving treatment of inflation expectations in empirical Phillips curve models; three recent models of information imperfections and inflation expectations; and potential policy implications of different models.

Suggested Citation

  • Michael T. Kiley, 2009. "Inflation expectations, uncertainty, the Phillips Curve, and monetary policy," Finance and Economics Discussion Series 2009-15, Board of Governors of the Federal Reserve System (U.S.).
  • Handle: RePEc:fip:fedgfe:2009-15
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    References listed on IDEAS

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    Cited by:

    1. Michael Debabrata Patra & Partha Ray, 2010. "Inflation Expectations and Monetary Policy in India; An Empirical Exploration," IMF Working Papers 10/84, International Monetary Fund.
    2. Wilbert Van der Klaauw & Wändi Bruine de Bruin & Giorgio Topa & Simon M. Potter & Michael F. Bryan, 2008. "Rethinking the measurement of household inflation expectations: preliminary findings," Staff Reports 359, Federal Reserve Bank of New York.
    3. Travis J. Berge, 2017. "Understanding Survey Based Inflation Expectations," Finance and Economics Discussion Series 2017-046, Board of Governors of the Federal Reserve System (U.S.).

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    Keywords

    Inflation (Finance) ; Monetary policy;

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