Using a novel macro-finance model we infer jointly the equilibrium real interest rate r*, trend inflation, interest rate expectations, and bond risk premia for the United States. In the model r* plays a dual macro-finance role: as the benchmark real interest rate that closes the output gap and as the time-varying long-run real interest rate that determines the level of the yield curve. Our estimated r* declines over the last decade, with estimation uncertainty being relatively contained. We show that both macro and financial information is important to infer r*.

This report provides a comprehensive overview of the models and tools used for macroeconomic projections within the European System of Central Banks (ESCB). These include semi-structural models, dynamic stochastic general equilibrium (DSGE) models, time series models and specialised satellite models tailored to particular questions or country-specific aspects. Each type of model has its own strengths and weaknesses and can help answer different questions. The models should therefore be seen as complementary rather than mutually exclusive.

Palestinians near the ruins of Gaza's international airport, which was shut down in 2001. Anas-Mohammed / ShutterstockGaza is going through one of the most severe economic collapses the world has seen in modern times. According to a UN report published in late November, the average income per person there is now just US$161 (£122) a year.

When you hear the phrase “family business,” you might think of the backstabbing Roys of “Succession” or the dysfunctional Duttons of “Yellowstone.” But while TV’s family companies are entertaining, their real-life counterparts may be even more compelling.