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Are US Inflation Expectations Re-Anchored?

Dieter Nautz () and Till Strohsal

No SFB649DP2014-060, SFB 649 Discussion Papers from Humboldt University, Collaborative Research Center 649

Abstract: Anchored inflation expectations are of key importance for monetary policy. If long-terminflation expectations arewell-anchored, they should be unaffected by short-termeconomic 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: E31 E52 E58 C22 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2014-10
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
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Journal Article: Are US inflation expectations re-anchored? (2015) Downloads
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