Global inflation, inflation expectations and central banks in emerging markets

From bis.org

In 2021 and 2022, inflation saw a synchronised increase in both advanced economies (AEs) and emerging market economies (EMEs). The inflation surge, which was initially thought to be transitory, was later diagnosed as persistent, and short-term inflation expectations across AEs and EMEs saw significant upward revisions. In this context, we address two crucial questions: How has the sensitivity of inflation expectations to global inflation changed in EMEs recently? And how can EME central banks reduce the impact of global inflation on inflation expectations? Contribution We provide evidence of the effect of global ... (full story)