Understanding inflation during and after covid

: the Portuguese case

Abstract

This work investigates the drivers of inflation in Portugal between January 2004 and March 2024, focusing on the period of the COVID-19 pandemic. Building on the work of L. M. Ball et al. (2022), and using both multiple linear regression and non-linear regression models, the study highlights the significant roles of unemployment and headline shocks in influencing the surge and duration of core inflation. The findings reveal that inflation during the pandemic was primarily driven by increased labor market tightness and supply chain disruptions, exacerbated by geopolitical events such as the war in Ukraine and the Gaza strip. Furthermore, there was a slight unanchoring of inflation expectations as economic agents adjusted to rising prices.

Date of Award	16 Dec 2024
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Pedro Duarte Silva (Supervisor)