Monetary Policy and Inflation Rates by Expenditure Deciles and Rural Areas
Evidence shows that loose and tight monetary policy shocks exerts different effects on the inflation by expenditure deciles and rural areas. At peak response expenditure deciles two, six and the rural areas’ inflation rates are more responsive to the repo rate loosening compared to the responses of expenditure decile ten. A similar pattern of responses is evident with respect to policy tightening.
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