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Beyond Energy: Inflationary Effects of Metals Price Shocks in Production Networks / Jorge Alberto Miranda Pinto, Andrea Pescatori, Martin Stuermer, Xueliang Wang.
- Format:
- Book
- Government document
- Author/Creator:
- Miranda Pinto, Jorge Alberto.
- Series:
- IMF Working Papers; Working Paper ; No. 2024/215
- IMF Working Papers
- Language:
- English
- Physical Description:
- 1 online resource (44 pages)
- Other Title:
- Beyond Energy
- Place of Publication:
- Washington, D.C. : International Monetary Fund, 2024.
- Summary:
- We examine the role of metals as economic inputs by using a production network model, calibrated for various countries using input-output (I-O) tables. Empirically, we employ local projections to study how metal shocks influence inflation, testing country-level heterogeneity in the sensitivity to these shocks. Our findings indicate that metals price shocks have significant and persistent effects on core and headline inflation, with particularly pronounced effects on countries that are highly exposed to metals in their production networks. This is in contrasts to oil supply shocks, which predominantly affect headline inflation. A shift of the global economy towards a higher relative metals intensity due to the energy transition could lead to commodity price shocks increasingly influencing core rather than headline inflation. This could make commodity price shocks less visible on impact but more persistent. Central banks should consider this shift when assessing inflation dynamics and risks.
- Notes:
- Description based on print version record.
- ISBN:
- 9798400293825
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