{"title":"The Asymmetric Impact of Oil Price Dynamics on Inflation in Brazil","authors":"Jephthah Osei","doi":"10.33422/eje.v2i2.251","DOIUrl":null,"url":null,"abstract":"This study investigates whether oil price changes have asymmetric pass-through effects on inflation using Brazilian quarterly data from the first quarter of 2000Q1 through 2021Q4. It applies a nonlinear Autoregressive Distributed Lag (NARDL) model that can simultaneously decompose the price of oil into its partial sum of positive and negative components to account for both the short-run and long-run asymmetric behaviour of inflation. The empirical findings reveal that the pass-through of the oil price to inflation from the short to the long term has a nonlinear or asymmetric effect. It concludes that the monetary authority should consider the asymmetric effects of the inflation-oil price nexus.","PeriodicalId":52999,"journal":{"name":"European Journal of Economics Law and Social Sciences","volume":null,"pages":null},"PeriodicalIF":0.0000,"publicationDate":"2022-10-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"2","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"European Journal of Economics Law and Social Sciences","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.33422/eje.v2i2.251","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"","JCRName":"","Score":null,"Total":0}
引用次数: 2
Abstract
This study investigates whether oil price changes have asymmetric pass-through effects on inflation using Brazilian quarterly data from the first quarter of 2000Q1 through 2021Q4. It applies a nonlinear Autoregressive Distributed Lag (NARDL) model that can simultaneously decompose the price of oil into its partial sum of positive and negative components to account for both the short-run and long-run asymmetric behaviour of inflation. The empirical findings reveal that the pass-through of the oil price to inflation from the short to the long term has a nonlinear or asymmetric effect. It concludes that the monetary authority should consider the asymmetric effects of the inflation-oil price nexus.