Dany-Knedlik, GeraldineHoltemöller, Oliver2025-05-292017https://epflicht.bibliothek.uni-halle.de/handle/123456789/56291009642804urn:nbn:de:gbv:3:2-823182717128We investigate drivers of Euro area inflation dynamics using a panel of regional Phillips curves and identify long-run inflation expectations by exploiting the crosssectional dimension of the data. Our approach simultaneously allows for the inclusion of country-specific inflation and unemployment-gaps, as well as time-varying parameters. Our preferred panel specification outperforms various aggregate, uni- and multivariate unobserved component models in terms of forecast accuracy. We find that declining long-run trend inflation expectations and rising inflation persistence indicate an altered risk of inflation expectations de-anchoring. Lower trend inflation, and persistently negative unemployment-gaps, a slightly increasing Phillips curve slope and the downward pressure of low oil prices mainly explain the low inflation rate during the recent years.1 Online-Ressource (III, 55 Seiten, 8,52 MB) : Diagrammeenghttp://rightsstatements.org/vocab/InC/1.0/330Book