Are central bank projections rational?
- Central bank projections have gained considerable attention for monetary policy modeling. However, less is known about the nature of central bank projections. This letter explores the unbiasedness and rationality of more than 2; 000 growth and in ation projections published by 15 major central banks. The results indicate that central bank projections are in most cases rational and unbiased. Interestingly, in ation projections are more biased than growth projections.
