Inflation target uncertainty magnifies price shocks’ impact- BoI paper

The Bank of Italy

A working paper published by the Bank of Italy paper looks at the impact of uncertainty about inflation targeting on the real economy. 

In Disinflationary shocks and inflation target uncertainty, Stefano Neri and Tiziano Ropele use a small‐scale New Keynesian model to study what happens when a central bank’s inflation target is not perfectly observed by the central bank itself, and by other agents. 

They find that under these conditions, disinflationary cost-push shocks have a negative impact

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Central Banking? View our subscription options

If you already have an account, please sign in here.

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account