Inflation expectations curve: a tool for monitoring inflation expectations

Release date
14/03/2016
Reference
AN2016/01
Author
Michelle Lewis
ISSN
2230-5505

Inflation expectations play an important role in monetary policy, where well-anchored expectations make it easier than otherwise to achieve the inflation target. This Note uses various surveyed measures of inflation expectations and yield curve modelling techniques to develop a framework for monitoring inflation expectations. From the resulting expectations curves, measures of the perceived inflation target focus and the expected time for inflation to return to target are estimated.