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Heterogeneous responsiveness of consumers’ medium-term inflation expectations

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  • Stanisławska, Ewa
  • Paloviita, Maritta

Abstract

Using a large euro area survey, we study the responsiveness of consumers’ medium-term inflation expectations to changes in actual inflation and short-term inflation expectations. We find that high trust in the central bank and high financial literacy lower this responsiveness.

Suggested Citation

  • Stanisławska, Ewa & Paloviita, Maritta, 2024. "Heterogeneous responsiveness of consumers’ medium-term inflation expectations," Economics Letters, Elsevier, vol. 237(C).
    • Handle: RePEc:eee:ecolet:v:237:y:2024:i:c:s0165176524001125
    DOI: 10.1016/j.econlet.2024.111629
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    References listed on IDEAS

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    1. Armantier, Olivier & Sbordone, Argia & Topa, Giorgio & van der Klaauw, Wilbert & Williams, John C., 2022. "A new approach to assess inflation expectations anchoring using strategic surveys," Journal of Monetary Economics, Elsevier, vol. 129(S), pages 82-101.
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    6. Dimitris Christelis & Dimitris Georgarakos & Tullio Jappelli & Maarten van Rooij, 2020. "Trust in the Central Bank and Inflation Expectations," International Journal of Central Banking, International Journal of Central Banking, vol. 16(6), pages 1-37, December.
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    More about this item

    Keywords

    Consumer Expectations Survey; Inflation expectations; Financial literacy; Trust; Micro-data;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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