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Trend inflation: Estimates for the Russian economy
https://doi.org/10.32609/0042-8736-2023-1-5-25
Abstract
The paper estimates the trajectory of trend inflation for Russia. A discussion of inflation measures used in macroeconomic models is presented, as well as the analysis of theoretical and empirical models that include a trend inflation indicator for monetary policy analysis. The paper also provides an overview of the use of trend inflation by monetary authorities of developed countries and emerging markets. Based on the methodology for assessing trend inflation with the help of models of unobservable components, the Kalman filter and including structural factors, the trajectory of trend inflation for the Russian economy from the beginning of 2001 to the end of 2021 is obtained. In addition, the paper provides a historical decomposition of cyclical inflation into structural shocks, as well as the decomposition of the variance of its forecast error into the considered shocks for 24 months in advance. The results of the econometric analysis testify in favor of a gradual decrease in the trend inflation rate to 4% per year after the 2015 crisis and further stabilization at this level. The situation in 2022 can be analyzed by analogy with the period of 2014—2015, one can expect a similar scenario for trend and actual inflation to return to pre-crisis levels in 2022 within one year (by March 2023).
About the Authors
S. M. Drobyshevsky
Gaidar Institute for Economic Policy
Russian Federation
Russian Federation
Sergey M. Drobyshevsky
Moscow
M. V. Kazakova
Russian Presidential Academy of National Economy and Public Administration
Russian Federation
Russian Federation
Mariya V. Kazakova
Moscow
E. V. Sinelnikova-Muryleva
Russian Presidential Academy of National Economy and Public Administration
Russian Federation
Russian Federation
Elena V. Sinelnikova-Muryleva
Moscow
P. V. Trunin
Gaidar Institute for Economic Policy; Russian Presidential Academy of National Economy and Public Administration
Russian Federation
Russian Federation
Pavel V. Trunin
Moscow
N. D. Fokin
Russian Presidential Academy of National Economy and Public Administration
Russian Federation
Russian Federation
Nikita D. Fokin
Moscow
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Drobyshevsky S.M., Kazakova M.V., Sinelnikova-Muryleva E.V., Trunin P.V., Fokin N.D. Trend inflation: Estimates for the Russian economy. Voprosy Ekonomiki. 2023;(1):5-25. (In Russ.) https://doi.org/10.32609/0042-8736-2023-1-5-25
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