Monetary Policy and Prices (Leaving Cert Economics): Flashcards

Sustained increase in general price level

Sustained decrease in general price level

Inflation still positive but slowing down

Excludes volatile items like energy & unprocessed food

Consumer Price Index - tracks Ireland's inflation

Includes mortgage interest payments

Harmonised Index of Consumer Prices for EU comparisons

HICP historically excludes owner-occupied housing costs

Aggregate demand grows faster than aggregate supply

Rising input costs shift aggregate supply leftward

Higher prices combined with lower output

Higher global prices or euro depreciation

Price stability (low & stable inflation)

Purchasing assets to lower long-term yields

Effects unfold over 12-24 months