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NY Fed Research On Notable Increase In Short-Run R*

FED
  • Part two of the NY Fed’s write-up on research on r* focuses on short-run estimates, and how “short-run r* has increased notably over the past year, to some extent outpacing the large increase in the policy rate” with the increase driven by financial shocks.
  • https://libertystreeteconomics.newyorkfed.org/2023/08/the-evolution-of-short-run-r-after-the-pandemic/
  • Recall that yesterday’s part one highlighted Fed research from June which showed the short-run real r* was forecast to be 2.5% by the end of the year, before discussing the particularly wide range to long-run estimates.

Source: New York Fed


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