Forecasting
Lagarde envisions new model for world of ‘shifts and breaks’
ECB chief predicts bigger supply shocks and relative price swings in future
RBNZ holds policy rate but revises up projection
Central bank expects rate to stay higher for longer and raises estimate of neutral rate
Focus is needed on improving central bank forecasts
Charles Goodhart believes tougher action over forecasting errors is preferable to policy-maker performance-related pay
BoE paper analyses banks’ forecasting accuracy
Banks with better governance, including more senior women, make better predictions, authors find
BoE raises rate 25bp as ‘mixed’ data clouds outlook
“I don’t think it is time to declare it is all over,” Bailey says
AI can forecast inflation more accurately than professionals – St Louis Fed
Large language models may be powerful tools but have some drawbacks, researchers say
Bernanke to lead BoE review of inflation forecasting
Former Federal Reserve chair will work with Bank of England officials
Monetary Policy Benchmarks 2023 report – navigating uncertainty
Benchmark data highlights ongoing evolution in policy frameworks as central banks move beyond the pandemic – and into the high-inflation period
Guillermo Avellán on BCE independence, capacity-building and dollarisation
Central Bank of Ecuador general manager speaks about the need to bolster the central bank’s legal autonomy, dollarisation challenges, payments developments and monetising local gold production
Machine learning pushes frontier of forecasting
AI techniques are starting to transform central banks’ statistical modelling. They could soon revolutionise structural models as well
Researchers use natural language processing to estimate inflation
Applying NLP techniques to earnings calls provides useful economic indicators, paper says
ECB’s monetary policy is taking effect rapidly, says Lane
But chief economist warns tighter financing conditions could cause eurozone contraction
Advanced economies most likely to survey trust and understanding
Data shows differences in how central banks judge the effectiveness of monetary policy
Latin America: Brazil holds rates despite president’s attack
Chilean board also holds policy, while Costa Rica cuts after inflation goes below target
Switzerland and Norway raise rates
Norges Bank expects further increases while SNB does not rule them out
BoE makes surprise 50bp rate increase
Central bank to review modelling framework after repeated forecast errors
To govern well, manage ‘enterprise’ risk
Effective risk management should be governance-oriented and top-down; not operationally oriented and bottom-up, writes John Mendzela
Central banks need short-run climate models – BdF governor
Governments may push central banks into ineffective climate action, Sarb governor warns
RBNZ raises rates to peak level
Central bank predicts rates will come down slightly faster than in February forecast
Bernanke and Blanchard reassess causes of inflation surge
Economists who predicted surge misunderstood underlying causes, study finds
‘Robust’ wage growth consistent with disinflation – BIS paper
But firms need to avoid increasing their profit margins, authors find
BoE adjusting main models after forecast misses
Bailey says policy-makers decided to “aim off” main forecast after repeated errors
ECB paper suggests faster methods for estimating eurozone employment
Nowcasting tools outperform models currently used by ECB, researchers say
BoE raises rates 25bp and ditches UK recession forecast
Central bank predicts inflation will stay higher for longer after MPC splits 7–2 on policy hike