Browsing by Subject "inflation"

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  • Bank of Finland (2020)
    Bank of Finland. Bulletin 5/2020
    The global economic crisis caused by the coronavirus pandemic intensified in March 2020. The health crisis and the lockdown measures necessary to contain the epidemic led to an exceptionally sudden and sharp decline in output worldwide in the first half of the year. In 2020 as a whole, the global economy is expected to contract by about 4–6%, and the euro area economy by about 8–10%. The euro area economy would seem to be diving a little deeper this year than the United States, but the pace of recovery is very uncertain for both. China saw the most difficult phase of the epidemic and thus the sharpest economic contraction in the first quarter of 2020. China’s recovery has been facilitated by the production and export of remote work equipment and protective equipment for the coronavirus disease. The pandemic shock has had a dampening effect on inflation. Unemployment is on the rise, but the euro area has avoided sudden mass unemployment through furloughs and government aid.
  • Korhonen, Iikka; Nuutilainen, Riikka (2016)
    BOFIT Discussion Papers 2/2016
    We estimate several monetary policy rules for Russia for the period 2003–2015. We find that the traditional Taylor rule describes the conduct of monetary policy in Russia reasonably well, whether coefficients are restricted to being the same or allowed to change over the sample period. We find that the Bank of Russia often overshot its inflation target and that extensive overshooting is associated with large depreciations of the ruble, testifying to the importance of the exchange rate in the conduct of monetary policy in Russia.
  • Oinonen, Sami (2016)
    Bank of Finland. Bulletin 1/2016
    For the past three years or so, Japan has pursued an economic policy named after Prime Minister Abe as abenomics, with the intention of putting the country back on a path of sustainable economic growth via expansionary monetary and fiscal policy and structural reforms. These goals have not yet been achieved, but there has already been some progress. For the time being, economic growth has been sluggish, but the deflationary trend has been halted and structural reforms have moved forward. The preconditions for success of the programme are in place.
  • Bank of Finland (2019)
    Bank of Finland. Bulletin 4/2019
    Global economic growth has slowed substantially in the current year. One cause has been the trade war between the United States and China, which has escalated further since the spring. Now both countries have already imposed additional customs duties on most of their bilateral trade in goods. Meanwhile, Brexit has added further to the uncertainties over the direction of the economy.
  • Bank of Finland (2019)
    Bank of Finland. Bulletin 3/2019
    Finland’s economic growth will slow in the forecast period to close to its potential rate. GDP will grow 1.6% in 2019 and 1.5% in 2020. Thereafter, the pace of growth will ease to 1.3% in 2021.
  • Bank of Finland (2019)
    Bank of Finland. Bulletin 5/2018
    Finnish growth will continue, but at a slower pace than in recent years. There is no returning to the growth rate that preceded the financial crisis.
  • Bank of Finland (2018)
    Bank of Finland. Bulletin 3/2018
    Finland's economic growth will continue and remain broadly based. Strong global demand, improved cost-competitiveness, growth in household income and favourable financing conditions will all support growth over the forecast period. GDP growth forecasts for 2018–2020 stand at 2.9%, 2.2% and 1.7%. The declining growth rate in the immediate years ahead reflects the moderate long-term outlook for growth. Inflation will remain close to 1% over the years 2018–2019 before gathering pace and reaching 1.5% in 2020.
  • Bank of Finland (2017)
    Bank of Finland. Bulletin 5/2017
    Finland’s economic growth is broadly based, exports are fuelling growth and at the same time domestic demand continues to be strong. According to the Bank of Finland forecast, Finland’s GDP will grow 3.1% in 2017 and 2.5% in 2018. Over the years 2019–2020 the economy will grow approximately 1.5% per annum. Inflation will gather pace but throughout the forecast period will be slower than elsewhere in the euro area.
  • Granziera, Eleonora; Kilponen, Juha (2018)
    Bank of Finland. Bulletin 3/2018
    Monetary policy decisions are based on assessment of the current and future state of the economy. In order to obtain forecasts, central banks build models, which are simplified representations of the complex interactions among macroeconomic variables. The Bank of Finland regularly publishes its forecasts, using a large set of data regarding current economic developments. Analysis of this large set of data includes the use of formal macroeconomic models, which are also employed to make projections for the future course of the economy. These projections represent the most likely values for the main macroeconomic variables of the Finnish economy.
  • Nuutilainen, Riikka; Korhonen, Iikka (2017)
    Russian Journal of Economics 4
    BOFIT Policy Brief 9/2017
    This study estimates whether the monetary policy rules of Bank of Russia have changed recently. Russia has moved towards inflation targeting over the past years, which is reflected in our empirical estimations. We start by estimating various monetary policy rules for Russia, concluding that a variant of the Taylor rule depicts Bank of Russia's monetary policy over the past decade well. Moreover, there have been two clear breaks in the coefficients of the estimated monetary policy rule, possibly signifying a shift towards traditional inflation targeting and also the current recent economic turbulence.
  • D'Acunto, Francesco; Hoang, Daniel; Paloviita, Maritta; Weber, Michael (2019)
    AEA Papers and Proceedings May
    Cognitive abilities help explain the large cross-sectional variation in inflation expectations at the household level. But which type of cognitive abilities are important? We find that not only quantitative abilities but also logical and verbal abilities are important to explain the accuracy and plausibility of households' inflation expectations. We discuss the channels through which different forms of cognition might shape households' abilities to forecast future macroeconomic variables. We also draw implications for the effectiveness of policies that aim to manage households' expectations.
  • Liikanen, Erkki (2015)
    Bank of Finland. Bulletin 1/2015
    Euro area inflation, core inflation and both short and long-term inflation expectations declined strongly during the second half of 2014. As a result of the prolonged period of exceptionally weak price developments, the ECB’s price stability objective began to lose its role as a solid anchor to price formation in the euro area.
  • Liikanen, Erkki (2018)
    Bank of Finland. Bulletin 1/2018
    Recent developments in the euro area and global economy have been favourable. In the euro area, economic growth is strong and broad-based, which is also reflected in decreasing unemployment. The output gap has closed in most euro area countries on the back of economic growth. Inflation remains still subdued, but confidence in inflation converging towards the ECB's objective has strengthened. Despite current favourable developments, the lessons learned from the financial and euro crises must not be forgotten.
  • Amstad, Marlene; Ye, Huan; Ma, Guonan (2018)
    BOFIT Discussion Papers 11/2018
    Inflation in emerging markets is often driven by large, persistent changes in food and energy prices. Core inflation measures that neglect or under-weight volatile CPI subcomponents such as food and energy risk excluding information helpful in assessing current and future inflation trends. This paper develops an underlying inflation gauge (UIG) for China, extracting the persistent part of the common component in a broad dataset of price and non-price variables. Our proposed UIG for China avoids the excess volatility reduction that plagues traditional Chinese core inflation measures. When forecasting headline CPI, the proposed UIG outperforms traditional core inflation measures over a variety of samples.
  • Bank of Finland (2016)
    Bank of Finland. Bulletin 1/2016
    The Bank of Finland forecasts a global growth rate of 2.8% in 2016, rising only slightly to 3.2% in 2017–2018. The growth pick-up reflects a recovery of the emerging economies suffering from the recession. World trade growth in the forecast period will be close to world GDP growth. The forecasts for the United States and the EU22 are more moderate than previously, but growth should still exceed the estimated potential growth rate. The growth forecast for China in 2016–2017 remains at 6%, from which it is expected to slow to 5% in 2018.
  • Kilponen, Juha; Kontulainen, Jarmo (2021)
    Bank of Finland. Bulletin 4/2021
    The ECB’s revised monetary policy strategy has now been adopted. The new 2% inflation target is clear and unambiguous. The target is symmetric, meaning both negative and positive deviations of inflation from the target are considered as equally undesirable. Commitment to the symmetric inflation target requires especially forceful or persistent monetary policy measures when interest rates are close to their effective lower bound. This may imply a transitory period in which inflation is moderately above target. A medium-term orientation with the inflation target also allows the ECB to emphasise sustainable growth and full employment in its decision-making. In its monetary policy, the ECB also takes into account environmental sustainability, in line with the new climate-related action plan.
  • Liikanen, Erkki (2017)
    Bank of Finland. Bulletin 1/2017
    Economic growth in the euro area is becoming more broadly based and there has already been four years of unbroken growth in GDP. The monetary policy of the ECB has been highly accommodative, lowering funding costs for both households and non-financial corporations across the euro area. Bank lending rates are at a historical low, which has strengthened credit growth. With lower unemployment and higher household incomes, confidence in future economic developments in the euro area is high. The accommodative monetary policy has buffered euro area growth against negative impacts from the growing global uncertainty, supported balance sheet restructuring in the financial sector and contributed to a reduction in leverage ratios.
  • Rehn, Olli (2020)
    Bank of Finland. Bulletin 5/2020
    The lockdown measures introduced to contain the global health crisis posed by the coronavirus pandemic led to a sharp contraction in economic activity during the second quarter of 2020. The world economy has already entered a fragile recovery, but one that will take a long time.
  • Rehn, Olli (2018)
    Bank of Finland. Bulletin 4/2018
    The euro area's growth rate is set to moderate to approximately 2%. A reduction in unemployment has created suitable conditions for accelerated wage growth and a return in the path of inflation to the policy objective of below, but close to, 2%. At its monetary policy meeting in June 2018, the Governing Council of the ECB took policy decisions spanning a period of over one year, at least through the summer of 2019. The Governing Council announced that monetary policy will continue to remain accommodative for an extended period, even if monetary policy has entered a path of gradual normalisation.
  • Rehn, Olli (2021)
    Bank of Finland. Bulletin 4/2021
    Growth in the euro area economy is expected to be brisk this year and in 2022 as economies are opened up, strong support is provided by economic policies and the global economy recovers. The rebound from an exceptionally severe and sudden crisis has been quick. The COVID-19 pandemic is not over yet though, and the spread of the Delta variant appears to have dampened the upward economic trend over the summer. But in developed economies with a high vaccination coverage the impact is not expected to be prolonged or of great significance.