Are Model-based Inflation Forecasts Used in Monetary Policymaking?: A Case Study |
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Page 11
... changes in which we are interested might not be the fundamental regime changes envisaged by Lucas ( Sims , 1982 ) ; even if each individual agent revises his decision rules anticipating a change in policy regime , the aggregation of ...
... changes in which we are interested might not be the fundamental regime changes envisaged by Lucas ( Sims , 1982 ) ; even if each individual agent revises his decision rules anticipating a change in policy regime , the aggregation of ...
Page 23
... changes in the variable which the forecast is conditional upon , relative to the value underlying the forecast , and observed prediction errors influence the setting of the control . In particular , if we flesh out our abstract model by ...
... changes in the variable which the forecast is conditional upon , relative to the value underlying the forecast , and observed prediction errors influence the setting of the control . In particular , if we flesh out our abstract model by ...
Page 28
... change in the latter variable ā is included in column 3.23 This variable is significant at the 5 per cent confidence level ... changes in the policy interest rate are likely to affect the exchange rate . Moreover , the inclusion of the ...
... change in the latter variable ā is included in column 3.23 This variable is significant at the 5 per cent confidence level ... changes in the policy interest rate are likely to affect the exchange rate . Moreover , the inclusion of the ...
Contents
in this paper we describe the uses to which such a model can be put in the policymaking | 8 |
How can an incomplete model be used? | 20 |
Concluding remarks | 31 |
1 other sections not shown
Common terms and phrases
actual inflation assessment assumption Banca d'Italia Bank of Italy basis points behaviour BIQM cent central bank changes coefficient composite inflationary pressure Consensus forecast December depreciation Deutsche Mark difference disinflation econometric elementary periods equilibrium estimated equation expected value fiscal forecast errors forecasting rounds forecasts produced future inflation given incomplete model inflation expectations inflation forecasts inflation targets inflationary pressure indicator initial conditions Italian lira Italy's labour cost agreements lagged repo rate lagged value latter lira lira/DM exchange rate loss function subject measure of inflationary model forecasts model simulations model-based monetary policymaking month monthly profile Nicoletti Altimari number of repos observed Pā percentage points policy instrument policy interest rate policy rule policy transmission channels policymaker's possibility reaction rule real interest rate regression repo operations result role Romer Rudebusch and Svensson sample period September sequence shortfall significant Siviero and Terlizzese tail probability target values Tinbergen underlying trend variable Visco Weighted average