• Media type: E-Book
  • Title: Disentangling the effects of multidimensional monetary policy on inflation and inflation expectations in the euro area
  • Contributor: Martínez-Hernández, Catalina [Author]
  • Published: [Berlin]: Freie Universität Berlin, 2020
  • Published in: Discussion paper ; 2020,18
  • Issue: This version: October 30, 2020
  • Extent: 1 Online-Ressource (circa 52 Seiten); Illustrationen
  • Language: English
  • DOI: 10.17169/refubium-28493
  • Identifier:
  • Keywords: Graue Literatur
  • Origination:
  • Footnote:
  • Description: The European Central Bank (ECB) has adopted a mixture of conventional and unconventional tools in order to achieve its mandate of price stability in the current low-inflation, low-interest-rate scenario. This paper contributes to the existing literature by providing a taxonomy of the ECB’s policy toolkit and by evaluating its implications on price stability and the anchoring of inflation expectations. I carry out my analysis based on a high-frequency identification and the estimation of a large Bayesian Vector Autoregression. I find evidence of re-anchored expectations as response to quantitative easing and forward guidance, i.e. forecasters revise their long-run expectations upwards. Consequently, inflation increases, which stresses the crucial role of expectations for the transmission of monetary policy.
  • Access State: Open Access