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Do Inflation Expectations Propagate the Inflationary Impact of Real Oil Price Shocks?: Evidence from the Michigan Survey
Author(s) -
WONG BENJAMIN
Publication year - 2015
Publication title -
journal of money, credit and banking
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.763
H-Index - 108
eISSN - 1538-4616
pISSN - 0022-2879
DOI - 10.1111/jmcb.12288
Subject(s) - inflation (cosmology) , economics , oil price , monetary economics , relative price , survey data collection , real interest rate , macroeconomics , keynesian economics , monetary policy , physics , statistics , mathematics , theoretical physics
This paper presents evidence that inflation expectations, as measured by the Michigan Survey of Consumers, only play a minimal role in the propagation of real oil price shocks into inflation. This is despite evidence that confirms that inflation expectations are sensitive to real oil price shocks. Further analysis suggests that after the 1990s, inflation expectations may have played no part in propagating real oil price shocks into inflation.