Policy Article
Inflation expectations: quo vadis?
Against the backdrop of the recent surge in inflation, we discuss available measures of inflation expectations and implications for monetary policy in the euro area. While long-term expectations are currently still in line with the ECB’s inflation target, the risk of a further rise increases should actual inflation remain high for an extended period of time. If expectations de-anchor the ECB may face difficult trade-offs.
Key Words
- ECB
- Euro area
- inflation expectations
- monetary policy