Macroeconomic Expectations and Credit Card Spending

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Consumers' macroeconomic expectations

“…They report a significant increase in current consumption following the unanticipated announcement of an increase in the value added tax by three percentage points, which signaled higher inflation in the future. Kanz et al (2021) explore the effect of providing information on inflation forecasts and exchange rate predictions by professional forecasters on consumers' inflation and exchange rate expectations and track whether this has implications for their self-reported consumption plans.…”

“…Kanz et al. (2021) explore the effect of providing information on inflation forecasts and exchange rate predictions by professional forecasters on consumers' inflation and exchange rate expectations and track whether this has implications for their self‐reported consumption plans.…”