RBA paper estimates long-term inflation expectations
A Reserve Bank of Australia paper, published on Monday, finds long-term inflation expectations are far less volatile than short-run inflation expectations, when inflation is well anchored.
Richard Finlay and Sebastian Wende, the paper's authors, estimate inflation expectations and inflation risk premia using inflation forecasts from Consensus Economics and Australian inflation-indexed bond price data.
The results suggest that long-term inflation expectations are well anchored within the 2–3%
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