Asymmetric Inflation Target Credibility
Date
From: Thursday March 13, 2025, 2:30 pm
To: Thursday March 13, 2025, 3:30 pm
Overview
This presentation will investigate the determinants of Inflation Target Credibility (ITC) using a unique survey designed to measure the credibility of the ECB's inflation target. Containing over 200,000 responses from German consumers collected between 2019 and 2024, this dataset, enables us to estimate the effect of both positive and negative deviations of inflation from the 2% target on ITC.
In contrast to the symmetry of the ECB's inflation target, it was found that ITC is asymmetric, i.e. consumers respond significantly to target deviations only when inflation is above target. When inflation is below target, however, the credibility of the inflation target cannot be improved by raising the inflation rate to close the gap.
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Professor Dieter Nautz is a Chair of Econometrics at Freie University, Berlin and was the Dean of the School of Business and Economics and the Head of the Department of Economics in 2019-2021 and 2012-2019, respectively.
Previously, he was Professor of Applied Macroeconomics at Goethe University Frankfurt and Guest Professor for Economic Theory at Humboldt-University in Berlin. His research focuses on Empirical Macroeconomics, Time Series Econometrics, and Monetary Policy. He is presently the Erskine Fellow at the University of Canterbury in Christchurch, New Zealand until 15 February 2025.
Venue
Canberra University,
Building 11 Room B50 , 11 Kirinari St , Bruce ACT 2617
