Macroeconomics
Greedflation, if it ever existed, is correcting itself
Steve Kamin constructs a “wage gap” to assess inflationary pressures in the US
Neural networks are ‘powerful tool’ for non-linear analysis – paper
Machine learning technique highlights downsides to inflation target ranges
Falling r* a ‘mirage’ in open economies – IMF paper
Adding exchange rate to standard model significantly changes predictions, authors find
IMF warns of slowing disinflation path
Higher interest rates in advanced economies could trigger “harmful spillovers”, chief economist warns
Regional disparities wider among EU’s newer members – study
Research shows that the poorer the country, the bigger the gap between its capital and its regions
BoE economists hunt ‘driving forces’ of forecast errors
“Systematic” study of mistakes finds wage growth and expectations could have been modelled better
Full-scale war with Hezbollah is a tail-end event – Bank of Israel deputy
Andrew Abir says central bank has advised government to ensure adequate fiscal space as it expects war to last longer and revises its growth and inflation forecasts
ECB official calls for European AI strategy
Plan required to keep European firms competitive, ECB board member Cipollone says
‘Selective memory’ helps explain expectation de-anchoring – paper
Authors build model around three “regularities of human recall”
Monetary policy could face ‘tougher tests’ ahead, BIS warns
Soft landing “in sight”, but pricing imbalances, fragile fiscal policy and financial vulnerabilities loom
Transitioning to renewables could reduce shock impact – research
Authors say Brazilian economy may serve as a model in the clean energy transition
Monetary policy-makers should track bubbles – Dallas Fed paper
Economists warn of possible ‘explosive bubbles’ and evaporating wealth
Simpler models can capture dynamics of Hank framework – NBER paper
Heterogeneity can be “irrelevant” to determining output in some situations, authors find
Book notes: The wealth of a nation, by Geoffrey Hodgson
This book provides a deep dive into the economic and institutional transformations that supported the rise of English capitalism
Central bankers warn of US election risks
Danger of tariffs and supply chain disruptions, Central Banking Summer Meetings hear
Global natural rates could be rising, SNB governor says
Jordan says Swiss central bank’s approach allows it to deal with uncertainty over r*
Acemoglu questions productivity benefits of AI
MIT economist finds weak productivity gains from AI and says benefits may be undermined by costs
Twenty years on, Visegrád states are converging to rest of the EU
Czech Republic, Hungary, Poland and Slovakia have undergone economic transformation, CNB finds
Can US policy choices explain economic divergence?
NIESR’s Ahmet Kaya finds US fiscal stimulus may have masked standard economic relationships, but economic gravity may soon reassert itself
Hungarian minister calls central bank ‘unco-operative’
MNB’s critique of government strategy draws official’s rebuke
Profit inflation and monetary policy: weighing the evidence
Biagio Bossone says profit inflation needs monetary ‘fuel’ to rise – but fiscal policy is the best fix, should governments have the ‘guts’
US news has a large impact on global bond yields – research
Bank of Canada research finds US news affects expectations in other countries
Generative AI’s impact on inflation unclear – BIS study
Inflation could worsen if people anticipate jump in productivity, authors say
Low growth threatens to reverse living standards – IMF
AI will drive growth but also increase inequalities, fund says