Cross-Country Report on Inflation: Selected Issues

International Monetary Fund

No 2015/184, IMF Staff Country Reports from International Monetary Fund

Abstract: This Selected Issues paper examines the causes and drivers of low inflation in European inflation targeting countries outside the euro area, focusing on the Czech Republic, Poland, Sweden, and Switzerland. It estimates the effects on inflation from the output gap and external factors, including oil price changes, nominal effective exchange rate (NEER) fluctuations, and euro area inflation spillovers. It is observed that external factors have been significant drivers of low inflation recently, though their contributions to inflation and the channels through which they operate vary across countries. Policy responses and options are also discussed, taking into account country-specific circumstances.

Keywords: ISCR; CR; inflation expectation; CPI inflation response; inflation objective; inflation falling; inflation fluctuation; inflation shock; inflation spillover; inflation targeters; inflation tolerance band; medium-term inflation expectation; noncore inflation; protracted inflation shock; inflation response; euro area inflation spillover; area inflation spillover; central bank; low inflation; Inflation; Exchange rates; Output gap; Oil prices; Central bank policy rate; Global (search for similar items in EconPapers)
Pages: 39
Date: 2015-07-14
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Citations: View citations in EconPapers (3)

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