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Gomes, S., Iskrev, N. & Ribeiro, P.P. (2021). Why a new strategy is necessary. In Ildeberta Abreu. João Valle e Azevedo  (Ed.), Perspectives on the ECB’S monetary policy strategy review. (pp. 3-6).: Banco de Portugal.

S. Gomes et al.,  "Why a new strategy is necessary", in Perspectives on the ECB’S monetary policy strategy review, Ildeberta Abreu. João Valle e Azevedo , Ed., Banco de Portugal, 2021, pp. 3-6

@incollection{gomes2021_1765613031621,
	author = "Gomes, S. and Iskrev, N. and Ribeiro, P.P.",
	title = "Why a new strategy is necessary",
	chapter = "",
	booktitle = "Perspectives on the ECB’S monetary policy strategy review",
	year = "2021",
	volume = "",
	series = "",
	edition = "",
	pages = "3-3",
	publisher = "Banco de Portugal",
	address = "",
	url = "https://www.bportugal.pt/sites/default/files/anexos/pdf-boletim/ppm_ecb_en.pdf"
}

TY  - CHAP
TI  - Why a new strategy is necessary
T2  - Perspectives on the ECB’S monetary policy strategy review
AU  - Gomes, S.
AU  - Iskrev, N.
AU  - Ribeiro, P.P.
PY  - 2021
SP  - 3-6
UR  - https://www.bportugal.pt/sites/default/files/anexos/pdf-boletim/ppm_ecb_en.pdf
AB  - Over the last decades, real interest rates have been on a steady downward trajectory in the euro
area and other advanced economies, largely reflecting a decline in the natural interest rate. The
natural interest rate (r*) denotes the short-term real interest rate prevailing under stable
macroeconomic conditions, in the absence of transitory shocks or nominal rigidities. While r* is an
unobservable variable whose empirical estimation is sensitive to the methodology adopted,
available estimates indicate that the natural interest rate has been falling in the euro area. It
presently stands at levels close to 0% or even negative, which compares with estimates of around
2% at the beginning of this century (Chart 2.1 – Panel A). The declining path has been determined
by structural factors, such as demographic developments and a slowdown in productivity and
potential output (i.e. the value of the output that an economy would have produced if labour and
capital had been employed at their maximum sustainable rates), but also by financial factors, which
have become particularly relevant in the wake of the crises that emerged since the last strategy
review (Brand, Bielecki and Penalver, 2018).

ER  -