output gap – IMF Blog

Euro Area Inflation: Why Low For So Long?

IMFBlog2019-03-13T15:15:23-04:00August 28, 2018|

By Yasser Abdih, Li Lin, Anne-Charlotte Paret

August 28, 2018

Sculpture of the euro outside the European Central Bank, Frankfurt, Germany: Convergence of core inflation towards the ECB’s medium-term objective is likely to be gradual (photo: Alex Domanski/REUTERS/Newscom)

The euro area economy is in its fifth year of recovery, unemployment is close to its pre-crisis level and the output gaps of most countries have closed. Yet, core inflation continues to be low, notwithstanding temporarily high headline inflation due to higher energy prices. […]

Chart of the Week: Central and Eastern Europe Close the Gap

IMFBlog2019-03-25T15:48:26-04:00May 22, 2017|

By IMFBlog

May 22, 2017

Version in Русский (Russian)

Most of the countries of Central, Eastern, and Southeastern Europe will see their economies humming away at a strong growth rate in 2017. A measure of their success at fully utilizing their economic machine is the output gap—the difference between what the economy is currently producing, and what it can produce when it is at full capacity.

Our Chart of the Week from a recently published report on the Central, Eastern, and Southeastern European region shows how close these economies come to performing at full potential. […]

Mind The Gap: Policies To Jump Start Growth in the U.K.

IMFBlog2017-04-15T14:04:43-04:00July 19, 2012|

The effects of a persistently weak economy and high long-term unemployment can reverberate through a country’s economy long into the future—commonly referred to by economists as hysteresis. Our analysis shows that the large and sustained output gap, the difference between what an economy could produce and what it is producing, raises the danger that a downturn reduces the economy’s productive capacity and permanently depresses potential GDP.