Research Catalog
Why has Core Inflation Remained so Muted in the Face of the Oil Shock?
- Title
- Why has Core Inflation Remained so Muted in the Face of the Oil Shock? [electronic resource] / Paul van den Noord and Christophe André
- Author
- van den Noord, Paul.
- Publication
- Paris : OECD Publishing, 2007.
Available Online
Details
- Additional Authors
- André, Christophe.
- Description
- 35 p.; 21 x 29.7cm.
- Summary
- To help policymakers form a judgment on inflation risks and the required monetary policy stance the OECD has developed an analytical framework based on a set of 'eclectic' Phillips curves estimated for the two largest OECD economies, the United States and the euro area, which is presented in this paper. This framework is used in the preparation of the Economic Outlook to explain recent developments in core inflation, excluding food and energy, based on developments in measures of economic slack (the output gap), spill-over effects from energy prices onto core inflation and lagged responses to past inflation via expectations formation. The fact that the knock-on effects from energy shocks onto core inflation appear small in comparison with the 1970s can be explained by the secular fall in energy intensity, a low and stable rate of 'mean inflation' -- to which observed inflation reverts after a shock has worked its way through -- and persistent slack in the aftermath of the bursting of the dotcom bubble.
- Series Statement
- OECD Economics Department Working Papers, 1815-1973 ; no.551
- Uniform Title
- OECD Economics Department Working Papers, no.551.
- Subject
- Economics
- LCCN
- 10.1787/206408110285
- OCLC
- oecd-lib-004216
- Author
- van den Noord, Paul.
- Title
- Why has Core Inflation Remained so Muted in the Face of the Oil Shock? [electronic resource] / Paul van den Noord and Christophe André
- Imprint
- Paris : OECD Publishing, 2007.
- Series
- OECD Economics Department Working Papers, 1815-1973 ; no.551OECD Economics Department Working Papers, 1815-1973 ; no.551.
- Connect to:
- Indexed Term
- Economics
- Added Author
- André, Christophe.
- Other Standard Identifier
- 10.1787/206408110285 doi