How do people make economic forecasts?
As we finalise our latest Global Economic and Markets Outlook, I have been thinking a lot about how other people make their own economic forecasts: it turns out we cannot make ours without taking a view on that. Read on to find out why! The expectations of firms, households and investors are central to the macroeconomic models used by central banks, and by others in the business of making economic forecasts. The New-Keynesian Phillips Curve (NKPC) is a case in