Haku

This paper studies the formation of inflation expectations in the euro area. We first analyse the forecast accuracy of ECB inflation projections relative to private sector forecasts. Then, using the ECB Survey of Professional ...

We evaluate and compare alternative monetary policy rules, namely average inflation targeting, price level targeting, and traditional inflation targeting rules, in a standard New Keynesian model that features recurring, ...

New Keynesian models generate puzzles when confronted with the zero lower bound (ZLB) on nominal rates, such as the forward guidance puzzle and the paradox of flexibility. We show that these puzzles are resolved when ...