Persistência e Volatilidade do Gap de Inflação

Sidney Caetano, Nelson Silva and Guilherme Moura

No 562, Working Papers Series from Central Bank of Brazil, Research Department

Abstract: In this article, we estimate a trend for Brazilian inflation in order to present an alternative measure of long-term inflation and provide a complement to the traditional core inflation measures. In addition to the economic analysis of the behavior of this estimation, a pseudo real-time predictive capability assessment is applied. Obtaining the trend also allowed us to verify the dynamics of the persistence and volatility of the inflation gap during the current monetary regime. In the period under review, the results are correlated with the Brazilian situation, with positive contributions from the trend in the inflation prediction process. Still, they show a resistance convergence of the inflation rate to the levels pre-established by the National Monetary Council (CMN, in Portuguese), in view of a considerable persistence of the inflation gap. The volatility of the gap, on the other hand, corroborates and identifies, at the same time, the great oscillations present in the domestic and external economic scenario.

Date: 2022-07
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