Theory of inflation dynamics is not good enough, warns Tarullo

Daniel Tarullo
Daniel Tarullo

Economics lacks a “working theory” of inflation dynamics that is “useful for real-time policymaking”, former Federal Reserve governor Daniel Tarullo warned on October 4, raising serious challenges for those trying to set monetary policy.

Many of the economic relationships underpinning standard monetary policy analysis broke down around the time of the financial crisis or even earlier, Tarullo said. “Unobservables” such as the natural rate of unemployment or equilibrium interest rates are

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 [email protected] or view our subscription options here:

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

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 here: