Ernesto Pasten

The recent surge in inflation has led to a significant increase in the frequency of price changes. This column argues that price flexibility has an impact on the effectiveness of monetary policy. In high inflation periods, frequent price changes make monetary policy more effective in reducing inflation with less impact on economic activity. Therefore, monetary policy should be more aggressive during such periods to stabilise prices efficiently. This approach allows central banks to achieve a ‘soft landing’ with less impact on activity. Overall, central banks should adjust their strategies based on the inflation environment to optimise economic outcomes.

During periods of high #inflation, #monetarypolicy can be more effective in reducing inflation as frequent price changes lower the impact of monetary policy on economic activity.
@peterkaradi.bsky.social @galonuno.bsky.social @ernestopasten.bsky.social et al.
cepr.org/voxeu/column...
#EconSky

Looking forward to the NBER Monetary Policy in Emerging Markets conference next week where I will present our paper:

peterkaradi.github.io/website/WorkIn…

Full program here:www.nber.org/conferences/...25

Glad to have had @PaulFontanier from Yale SoM and Juan Herreño from UCSD visiting @CBChileresearch this week. Interested in our visitors program? Details here: bit.ly/4gi4j3Q

Thank you guys!

Next week: MC De Nardi and M Basetto

NBU Opens Special Account to Raise Funds for Ukraine’s Armed Forces (updated)   The National Bank of Ukraine has decided to open a special fundraising account to support the Armed Forces of Ukraine. The central bank’s decision comes after the Ukrainian gove...

To those in the US who want to donate $ to #Ukraine, consider these options

National Bank of UKR: bank.gov.ua/en/news/all/...

Humanitarian aid (tax deductible):

Kyiv-Mohyla Foundation of America: www.kmfoundation.org

Kyiv School of Economics: kse.ua/support/dona...

Nova Ukraine: novaukraine.org

Visiting scholar program at the Central Bank of Chile. Deadline: March 14th. Researchers from academia and institutions are welcome. Visit our vibrant group and enjoy Chile: Santiago, wineries, skiing in June-Sept, Valparaiso, Atacama, Easter Island, lakes district, Patagonia.

bit.ly/4gi4j3Q

PhD Dissertation Fellow - Federal Reserve Bank of St. Louis Research Division

Accepting applications for 8 open positions during the summer of 2025. The application deadline is Friday, February 28, 2025. Submit the online application for the dissertation fellow position at econjobmarket.org.

This is huge

Happy to report the outcome of the PhD application season for our predocs at Central Bank of Chile’s research group. All four applicants allocated to great schools: Minnesota, Duke, Berkeley and Columbia + one predoc in a sister group going to Chicago. Happy and proud of all of you. You guys rock!