Suchergebnisse

AbstractPolicymakers face an extremely uncertain environment during COVID‐19. Using a nonlinear VAR estimate for the Euro Area, we argue that the benefit of reducing policy uncertainty at a time dominated by pessimistic expectations amounts to several points of GDP. The impact on the economy of uncertainty shocks is much larger during periods of negative outlook for the future. We estimate the impact on industrial production of the current COVID‐19 induced uncertainty to peak at a year‐over‐year growth loss of −15.4 per cent in September 2020, and to lead to a fall in CPI inflation between 1 per cent and 1.5 per cent. Policies providing state‐contingent scenarios ready to be adopted if the worst‐case outcomes materialise can reduce the impact of uncertainty.

ABSTRACTThis article discusses macroeconomic policies in a low interest rate environment, the central theme of the 2017 edition of the Melbourne Institute Macroeconomic Policy Meeting. After reviewing possible causes of the decline in interest rates observed since the 1990s, we present and discuss some of the challenges that monetary and fiscal policy face in a 'new normal' environment characterised by a real natural interest rate close to zero. Proposals by leading researchers on how to operate in such an environment are presented and discussed. We conclude by outlining some research questions that are highly relevant from a policy perspective.

AbstractThis article summarises the academic contributions presented and discussed during the 2016 edition of the Melbourne Institute Macroeconomic Policy Meetings, which focused on the role played by uncertainty for a number of countries' business cycle. Considerations on the interaction between uncertainty and financial frictions, the global dimension of uncertainty, uncertainty shocks in times of unconventional monetary policy and the imperfect knowledge that agents have over policy targets are among the discussions entertained in this article. The main insights coming from those papers are connected with the extant literature and directions for future research are offered.