Economics
BoE paper takes DSGE approach to deflation probabilities
Comparing simulations using a DSGE model estimated on different market-based measures of deflation probability helps to pick out causality, researchers say
Data as a critical factor for central banks
Central banks must industrialise data-handling processes to deliver better decision-making, says Maciej Piechocki of BearingPoint
Fischer examines growth dilemma
Fed vice-chairman says behaviour of inflation and output as economy normalises may provide some answers
Big data in central banking: 2016 survey
Results and analysis of a survey examining how central banks view big data and data governance in their institutions
Bank of Namibia revises growth forecasts
Latest economic outlook warns lower production from the mining sector will have an impact on GDP levels for this year, but growth is expected to pick up in 2017
Weighting models by performance is better than taking simple averages, researchers say
Weighting models by performance is better than taking simple averages, researchers say
Barro and Summers wrestle with productivity puzzle
Veteran economists seek to offer explanations and policy prescriptions for strong employment and weak growth in the US and elsewhere
ECB paper assesses influence of international linkages on length and severity of recession
Credit growth combined with other vulnerabilities is important, authors argue
More research needed on exchange rate pass-through, ECB article says
Research on effects of different shocks on inflation “still in an incipient phase”
Riksbank paper shows importance of modelling bank costs
Models should not assume financial intermediation is free, authors say, showing banks can reduce aggregate welfare in some cases
Oil price rises and US GDP growth have ‘complex relationship’ – paper
Paper studies interaction of oil price and economic growth in US from 1875 to 2016
Hedging demand can cause covered interest parity violations – BIS paper
US dollar forward hedging demand can cause covered interest parity to fail even when markets are calm, authors say, helping explain this post-2012 anomaly
AnaCredit: banking with (pretty) big data
The supranational credit database in Europe will help policy-makers and banks assess cross-border risk when it goes live in 2018, writes Aurel Schubert, director-general of the European Central Bank’s statistics department
Lagarde welcomes ‘major policy shift’ in Saudi Arabia
IMF managing director says efforts to reduce reliance on oil are “very welcome”, although Gulf countries more generally need to continue their fiscal adjustment
Commodity prices create ‘strong pressure’ to lower interest rates – paper
Policy response to commodity price fluctuations has been stronger in the US, paper finds; commodity price shocks follow two cycles, with the most recent having impacts on policy rates
Sponsored forum: Evaluating big data capabilities in central banking
Central Banking convened a panel of experts to discuss the big questions about big data, how and where it can add value to central banking in the near term, and balancing the pros against the cons
Bundesbank paper models spillover effects of risk shocks in financial crisis
Paper finds spillover effects of general risk are stronger than spillovers in response to bailouts
Blanchard and Acalin warn of FDI measurement problems
Measured foreign direct investment is not as long term as generally thought, often reflecting transient capital flows and responding to US monetary policy, economists find
Bundesbank paper looks at financial shocks’ impact on inflation
Shocks that cause output and inflation to diverge can worsen trade-offs for central banks, paper says
Pressure in the Danish labour market becoming ‘more evident’
All spare resources in the labour market have already been used, report says; employment has risen by 105,000 people from Q4 2012 to Q2 2016
Output gap in euro area is much larger than official estimates – paper
Official estimates predict output gap 3–4% less negative than author’s results; current models do not “adequately capture” inflation developments
Fischer notes ‘considerable uncertainty’ around longer-run federal rate
Fed vice-chairman cites 2003 paper by Laubach and Williams
Evaluating big data capabilities in central banking
Central Banking convened a panel of experts to discuss how big data can add value to central banking in the near term, the need for good governance, and balancing the pros against the cons
UK inflation jump to 1% is just ‘tip of the iceberg’
Latest inflation data shows leap from 0.6% in August to 1% in September; former MPC member Sentance says this is just tip of the iceberg