Energy constitutes an essential share of costs across any economy. The percentage of electricity in the overall energy consumption is steadily increasing. This increase, however, is not reflected correctly in the consumption basket relevant for measuring inflation and, therefore, for monetary policy formulation. We argue that the energy mix reflected in inflation should be revised in favour of electricity. We present an analysis of inflationary pressures across Europe and decompose the impact of energy categories on headline inflation. Building on the inflation expectations framework, this study examines the characteristics and magnitude of the current energy price dynamics and quantifies its share in the countries’ effective inflation. Our research also confirms a compelling insight into the country’s energy structure and inflationary pressures when a larger share of renewable electricity sources proves to be associated with lower inflation. Finally, we argue that the energy price shock cannot be viewed as a one-shot event as in the case of oil price shocks in the past. We draw recommendations for monetary policy formulation. The implication of renewable sources on inflation should be of interest to policymakers, especially in times of high, almost galloping inflation rates in some European countries, unstable fossil energy sources supply due to geopolitical instability, and climate crisis.

Purpose: The purpose of the article is to compare a degree of beta-convergence between V4 countries and EU28 at national and NUTS 2 level. Methodology/Approach: We will make this comparison separately for each indicator (gross domestic product at current market prices, unemployment rate and disposable income of households.). To evaluate beta-convergence differences at national and regional level, we will compare the data for the V4 countries and for Germany and Austria. To show convergence, we approximated the GDP growth trend in individual countries, using a trend line for three different time periods. Findings: Our results point to persistent disparities between regions. They have confirmed that the cohesion policy in the regions of the V4 countries should promote innovations and investments into less developed and predominantly agricultural regions, complete the necessary backbone infrastructure and develop a high-quality regional education. At regional level, the implementation of high value-added programs may be hampered by institutional factors and a lack of capacity to make the necessary infrastructure or human capital investments. Our analysis showed that differences in regional performance are also accompanied by significant differences in investigated indicators. Research Limitation/Implication: Limitations of the paper are at first missing data for Poland to the year 2013. Second limit of the article are data from regions, because data are related to the palce of residence of its branch. Originality/Value of paper: Paper is full original,also a data analysis does not copy any other articles neither article in a journal nor paper on conference.

The paper provides empirical analysis of interactions between monetary and fiscal policy in the Czech Republic and document changes in policy conduct across the time. To this end, we build and estimate a six-variable Bayesian VAR and propose some refinements to the modelling framework. These improvements make it possible to better capture the main features of the economic system populated by both macroeconomic policy authorities. The results point to the lack of complementarity between policy actions adopted by the authorities and suggest that there is still enough room for enhancing the effectiveness of economic policies.

Adoption of the FX Commitment in the Czech Republic: Some Reflections of the Insider