No. 1474 - Monetary policy shocks and inflation inequality

by Christoph Lauper and Giacomo Mangiante
December 2024
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This paper studies the effects of monetary policy shocks on inflation inequality in the United States, computed by combining disaggregated data on sectoral price growth and household-level consumption data from the Consumer Expenditure Survey.

Following an unexpected increase in the interest rate by the Federal Reserve, the dispersion in inflation inequality decreases. The effect is mainly driven by the energy sector, which accounts for a sizable share of the consumption bundle of lower-income households.

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  1. 20 December 2024
    No. 1474 - Monetary policy shocks and inflation inequality
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