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October 3, 2025

Robust Monetary Policy under Inflation Uncertainty

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Effective monetary policy can mitigate inflation without exacerbating economic damage.
Inflation signals from both demand and supply shocks complicate central bank strategies.
The study emphasizes the need for adaptable monetary policies in unpredictable economic climates.
Proactive measures by central banks may help stabilize the economy amidst inflation uncertainty.

Analysis explores how central banks can navigate inflation uncertainty from demand and supply shocks.

When inflation stems from both demand and supply shocks, how can central banks act without triggering deeper economic damage?

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Mario Carceller del Arco (2025) studied this question.

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Analysis explores how central banks can navigate inflation uncertainty from demand and supply shocks.

When inflation stems from both demand and supply shocks, how can central banks act without triggering deeper economic damage?