Are US inflation expectations re-anchored?

Dieter Nautz and Till Strohsal

No 2014-060, SFB 649 Discussion Papers from Humboldt University Berlin, Collaborative Research Center 649: Economic Risk

Abstract: Anchored inflation expectations are of key importance for monetary policy. If long-terminflation expectations arewell-anchored, they should be unaffected by short-term economic news. This letter introduces newsregressions with multiple endogenous breaks to investigate the de- and re-anchoring of US inflation expectations. We confirm earlier evidence on the de-anchoring of expectations driven by the outbreak of the crisis. Our results indicate that expectations have not been re-anchored ever since.

Keywords: Anchoring of Inflation Expectations; Break-Even Inflation Rates; News-Regressions; Multiple Structural Break Tests (search for similar items in EconPapers)
JEL-codes: C22 E31 E52 E58 (search for similar items in EconPapers)
Date: 2014
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Journal Article: Are US inflation expectations re-anchored? (2015)
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