We build a model for bond yields based on a small-scale representation of an economy with secular declines in inflation …, the real rate and output growth. Long-run restrictions identify nominal shocks that influence long-run inflation but do … results show that, before the anchoring of inflation around the mid-1990s, nominal shocks lifted the output gap and inflation …

We develop a theoretical model that features a business cycle-dependent relation between output, price inflation and … inflation expectations, augmenting the model by Svensson (1997) with a nonlinear Phillips curve that reflects the rationale … pronounced convex relationship between inflation and the output gap, meaning that the co-efficient in the Phillips curve on the …

useful for predicting inflation. In addition, countries where slack (and potential growth) is overestimated to a larger …

.e. standard errors, unbiasedness and conditional inflation forecasts. Real-time estimates from univariate moving average filters … and from bivariate UOC models based on output and inflation are found to be rather uninformative. Extended models, which …