Does money growth help explain the recent inflation surge?

Claudio Borio, Boris Hofmann and Egon Zakrajšek in this BIS Bulletin article:

  • The strength of the link between money growth and inflation depends on the inflation regime: it is one-to-one when inflation is high and virtually non-existent when it is low.
  • A link can also be seen in the recent possible transition from a low- to a high-inflation regime. An upsurge in money growth preceded the inflation flare-up, and countries with stronger money growth saw markedly higher inflation.
  • Looking at money growth would have helped to improve post-pandemic inflation forecasts, suggesting that its information value may have been neglected.

Will monetary aggregates make a comeback?

2 Responses to “Does money growth help explain the recent inflation surge?”

  1. La crescita della moneta aiuta a spiegare il recente aumento dell'inflazione? - KiteKu Says:

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  2. Does cash progress assist clarify the latest inflation surge? – 52weekshares Says:

    […] Economics – macro, micro etc. You possibly can observe any responses to this entry via the RSS 2.0 feed. You possibly can leave a response, or trackback from your personal […]

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