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Monitoring the Inflationary Effects of COVID-19 (FRBSF, 6 page read) San Fran Fed decomposes PCE inflation COVID categories. They find that the demand shock is pulling inflation lower more than the supply shock is higher. They will be reporting their new inflation measure monthly. [Bullish rates]
Medium-Term Money Neutrality and the Effective Lower Bound (NBER, 25 page read) Gauti Eggertsson is pioneering in the field of policy at the zero lower bound. Here, he investigates the effects of monetary policy at the effective lower bound. Paradoxically, the expansionary monetary policy is even more effective in near money neutrality scenarios.
Inflation At Risk From Covid-19 (BIS, 6 page read) The pandemic has increased deflationary risks in advanced economies, whilst it has increased large inflationary and deflationary risks in emerging markets. This comes down to the collapse in output and oil prices, recent exchange rate depreciations, and tighter financial conditions. [Bearish EM rates]
Are Shadow Rate Models of the Treasury Yield Curve Structurally Stable? (Fed, 44 page read) Argues against current shadow policy rate models used since 2008 to capture true monetary policy.