## Is Inflation Domestic or Global? Evidence from Emerging Markets

_IMF Working Papers, November 8, 2018_

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## Bibliographic details
- Authors: Rudolfs Bems, Francesca Caselli, Francesco Grigoli, Bertrand Gruss, Weicheng Lian
- Published: November 8, 2018
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781484381595.001

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### Overview
- Following a period of disinflation during the 1990s and early 2000s, inflation in emerging markets has remained remarkably low and stable.
- Research question: Was this decline related to a global disinflation environment triggered by China's integration into world trade and broader globalization, or to better domestic policies?
- Sample: 19 large emerging markets examined over the past couple of decades.
- Method: Review of inflation performance and quantification of the impact of domestic and global factors in determining inflation.

### Key empirical findings
- The level, volatility, and persistence of inflation declined significantly, albeit not uniformly across the sample.
- Longer-term inflation expectations, linked to domestic factors, were identified as the main determinant of inflation.
- External factors played a considerably smaller role in explaining inflation outcomes in the sample.

### Policy implications and relevance
- Results provide evidence for emerging markets as they craft monetary policies to navigate future shifts in global financial conditions.
- Emphasis on domestic policy credibility and anchoring of longer-term inflation expectations as central for maintaining low and stable inflation.

### Additional notes from the publication landing page
- Authors: Rudolfs Bems, Francesca Caselli, Francesco Grigoli, Bertrand Gruss, Weicheng Lian.
- Date of publication: November 8, 2018.
- Series: IMF Working Papers, Working Paper No. 2018/241.
- Pages: 26.
- DOI: https://doi.org/10.5089/9781484381595.001

*Source: "Is Inflation Domestic or Global? Evidence from Emerging Markets", IMF Working Paper No. 2018/241 (November 8, 2018).*

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_Source: https://www.imf.org/en/publications/wp/issues/2018/11/08/is-inflation-domestic-or-global-evidence-from-emerging-markets-46306_