Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/242950 
Year of Publication: 
2021
Series/Report no.: 
BoF Economics Review No. 5/2021
Publisher: 
Bank of Finland, Helsinki
Abstract: 
This paper presents the New Keynesian Phillips Curve (NKPC) -based framework for analysing euro area inflation outlook. Our NKPC specification, that relies on market- and survey-based inflation expectations, explains well euro area inflation dynamics. Its forecasting performance is also comparable to the performance of the ECB's official forecasts in both short- and long-horizons. Overall, the NKPC is a useful tool for monitoring euro area inflation outlook. Thanks to its fast and light updating procedure it provides almost real-time information on inflation outlook.
Subjects: 
euro area
inflation expectations
inflation forecasting
Phillips curve
JEL: 
E31
E37
Persistent Identifier of the first edition: 
Document Type: 
Research Report

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