Gaston Reinesch: Beyond the horizon of the Luxembourg presidency – a central banker’s perspective Speech by Mr Gaston Reinesch, Governor of the Central Bank of Luxembourg, at the National Bank of Poland’s Biannual EU Presidency Lecture, Warsaw, 27 October 2015.
The most obvious way of measuring inflation persistence is to regress inflation on several of its own lags and then calculate the sum of the coefficients on lagged inflation. If the sum of the coefficients is close to 1.0, then shocks to inflation have long-lived effects on inflation.