Macroeconomics
Leading governors analyse evolving inflation-employment relationship
Powell, Draghi, Lowe and Kuroda assess causes keeping wage growth low across the world
Woodford shows finite horizons matter when modelling
Removing rational expectations can change key economic results, says Michael Woodford
Andy Haldane rethinks traditional growth narrative
New research implies growth did not “flatline” before the industrial revolution
Brainard says yield curve inversion may not presage recession
Flatter yield curve “may temper somewhat” fears of a coming recession, says governor
Housing inequality creates credit inequality – NY Fed’s Hirtle
Older people with less need of credit have seen the value of their collateral rise more
RBA paper finds elusive interest rate-investment link
Authors present empirical evidence for inverse relationship between rates and investment
Bundesbank paper asks ‘how far can we forecast?’
Statistical tests imply forecasts typically become uninformative after just a few quarters
Swedish paper examines effects of business cycles on employment
Volatile business cycles cut new jobs and employment, Riksbank paper says
BoE paper investigates uncertainty around elections
Elections help to isolate macroeconomic and financial uncertainty, author argues
More older people and women joining labour force, RBNZ paper finds
New Zealand’s labour force participation has grown since 2000 and reached an all-time high in 2017
Real rates likely to move back up – BIS paper
Use of “shadow rate” allows authors to account for the effective lower bound
US labour participation rate down more than OECD average – Dallas Fed
Higher incarceration rates and worse social services may partly explain trend
Israel’s Flug calls for higher-quality labour market
Country is close to full employment but must do more to improve labour market conditions, governor says
BIS economists find frictions in banks’ dollar funding
Authors investigate wide divergence in the business models of European and Japanese banks
Stock imbalances can stabilise or destabilise – BIS paper
Asymmetry implies burden of adjustment tends to fall on deficit countries
RBI paper finds complexity in exchange rate pass-through
Authors challenge standard view that exchange rates have a “linear and symmetric” impact
BoE not to blame for gold standard-era crises in US – paper
Bank of England not responsible for “causing or aggravating” crises in the US, author finds
Intellectual property investment fuelling growth in Australia – Lowe
RBA governor says lack of growth in “tangible assets” is turning investment towards IT
Yield curve inversion still tends to signal trouble ahead – Fed economists
The term spread has a “strikingly accurate record” for forecasting recessions, say researchers
Dudley goes against Trump’s protectionist line
New York Fed president criticises protectionism as Donald Trump steps up rhetoric
BIS paper uses ‘shadow rate’ to study market expectations
Fan Dora Xia and Jing Cynthia Wu find they can estimate expectations over a longer horizon
Lacklustre recovery down to pre-crisis factors – research
San Francisco Fed article says weak recovery in the US due to long-running factors
World does not have to be ‘hostage’ to technology – Wilkins
Finding a way to control the market power of tech giants will be important, the Bank of Canada deputy says
Deflation tends to de-anchor expectations – BIS paper
Deflationary episodes seem to render expectations lower and more backward-looking