Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/212306
Authors: 
Oinonen, Sami
Paloviita, Maritta
Year of Publication: 
2014
Series/Report no.: 
Bank of Finland Research Discussion Papers No. 31/2014
Abstract: 
This paper examines recent changes in the cyclicality of euro area inflation. We estimate time-varying parameters for the hybrid New Keynesian Phillips curve using three alternative proxies for the output gap. Our analysis, which is based on the state-space method with Kalman filtering techniques, suggests that the slope of the euro area Phillips curve has become steeper since 2012. Thus, the current low level of inflation and persistently negative output gap increase the risk that euro area inflation will stay below the monetary policy target for an extended period.
Subjects: 
inflation
Phillips curve
cycle
JEL: 
E31
E52
E32
Persistent Identifier of the first edition: 
ISBN: 
978-952-323-014-9
Document Type: 
Working Paper

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