Sectoral prices growing in importance as inflation driver – BIS paper
Monetary policy risks being “overly forceful” if it tries to respond, Borio and co-authors warn
Sector-specific price changes are becoming more important as a driver of inflation in many economies, research published by the Bank for International Settlements finds.
Authors Claudio Borio, Piti Disyatat, Dora Xia and Egon Zakrajšek say this finding calls for flexibility from central banks.
The quarterly bulletin article explores data from the US on 131 “narrowly defined” sectors of the personal consumption expenditures inflation index. The “common component” of inflation becomes less
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