Articles on the economy
It is well known that the real natural rate of interest, r*, is an inherently unobservable variable, and therefore reasonable estimates of its level are hard to determine. In our search for such estimates, we first apply a semi-structural model by Holston, Laubach and Williams (2023) and the Federal Reserve Bank of New York’s recent estimate of the euro area natural rate.
The surge in inflation has prompted central banks to normalise their monetary policy. This means they are tightening financing conditions by raising key interest rates.
In just over two months, the Russia’s war has caused severe economic dislocation in many areas. We assess possible economic impacts of the Ukraine invasion on Russia and the euro area.
The Finnish, Swedish and German economies weakened almost simultaneously in March. The latest indicators show signs of a pick-up, but uncertainty will slow the recovery.
In the aftermath of the global financial crisis many central banks cut their policy rates close to zero and introduced non-standard monetary policy measures. The new situation has also presented a challenge for monetary policy modelling.