Inflation surprises and inflation expectations in the euro area

Marcello Miccoli () and Stefano Neri

No 265, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: Since 2013 the inflation rate in the euro area has fallen steadily, reaching all-time lows at the end of 2014. Market-based measures of inflation expectations (such as inflation swaps) have also declined to extremely low levels, which suggests increasing concern about the credibility of the ECB in maintaining price stability. Inflation releases have often surprised analysts on the downside. Our analysis shows that market-based inflation expectations, at medium-term maturities, are affected by these �surprises�, over and above the impact of changing macroeconomic conditions and oil prices.

Keywords: inflation; inflation expectations; inflation swap contracts (search for similar items in EconPapers)
JEL-codes: C22 C31 E31 E52 (search for similar items in EconPapers)
Date: 2015-03
New Economics Papers: this item is included in nep-cba, nep-eec, nep-mac and nep-mon
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Citations: View citations in EconPapers (19)

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Journal Article: Inflation surprises and inflation expectations in the Euro area (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:bdi:opques:qef_265_15

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