Policy initiatives in the global recession: what did forecasters expect?

Carvalho, Carlos; Eusepi, Stefano; Grisse, Christian

Journal Article

Policy initiatives in the global recession: what did forecasters expect?

Abstract: The global recession of 2008-09 led to monetary and fiscal policy responses by central banks and government authorities that were often unconventional in size and scope. A study of expansionary measures employed during the recession suggests that overall, the policies were likely effective in shaping the outlook for a recovery, as forecasters raised their expectations of inflation and GDP growth after the policies? implementation. From this perspective, the policies stimulated economic activity and prevented deflationary pressures during the financial crisis.

Keywords: Monetary policy; Fiscal policy; Recessions; Economic forecasting; Inflation (Finance); Gross domestic product;