Semi-structural models are the forecast weapon of choice

Flexible modelling approach comes out on top; around half of central banks include a financial sector

Semi-structural models are comfortably the most popular forecasting models used by the economics departments of central banks when they are making essential forward-looking predictions.

Around 57% of the 30 central banks surveyed in Economics Benchmarks 2020 reported that semi-structural models were their key forecast models. These models combine some of the flexibility of time-series modelling with the theoretical rigour of structural models.

In second place were dynamic stochastic general

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