Unexpected Inflation

Unexpected Inflation

A situation in which the inflation rate is higher than economists, regulators or others anticipated. Unexpected inflation may occur when the currently held macroeconomic model does not adequately account for new circumstances. For example, in the 1970s, the United States experienced unexpected inflation when classical Keynesianism held that inflation was virtually impossible when GDP growth was sluggish; this turned out to be untrue. As with all inflation, unexpected inflation is good for borrowers, but detrimental to both lenders and persons who save. See also: Stagflation.
References in periodicals archive ?
Even in the election year, there was no unexpected inflation,' he added.
From a review on several long-term research papers: 'Most studies conclude that expected inflation can either positively or negatively impact stocks.' Not much help but the key word is 'expected.' 'Unexpected inflation' showed more conclusive findings and that was, it all depended on where the economy was in the boom/bust economic cycle.
According to Robredo, the TRAIN law has so many implications, including the unexpected inflation rate.
The Chilean tax authorities also have provisions to help business owners deal with unexpected inflation that allow them to maintain value of their business.
The most popular option are Treasury Inflation-Protected Securities (TIPS), which help protect against unexpected inflation because their interest payments reflect the stated fixed interest plus the inflation amount as measured by the Consumer Price Index (CPI).
After all, bank depositors regularly lose more when unexpected inflation erodes their savings' real purchasing power (only the nominal value of those deposits is insured).
Bursts of unexpected inflation redistribute wealth from lenders to borrowers, because each repaid dollar is worth less than when it was borrowed.
Skewness statistics show that unexpected inflation and changes of expected inflation are positively skewed with the highest positive skewness found in unexpected inflation and the lowest in changes of expected inflation.
We then examine the relation between the world budget surplus factor and estimated world factors in national output gaps, equity valuation ratios, unexpected inflation, and military spending.
As a result of unexpected inflation risks, UK interest rate expectations for this year were themselves pushed back and traders began to close GBP positions.
Inflation and unexpected inflation are negatively related to insolvency, which rejects Hypothesis 8 (inflation cost hypothesis).
expected inflation unexpected inflation or inflation uncertainty.