Tactical Macro-Drivers

  • Henrik Lumholdt


In this chapter, we lay the foundation for a business cycle approach to TAA which will be elaborated further in Chap.  9. Section 8.2 first outlines standard business cycle analysis and the dating of business cycles. We will then shift our attention to the concept of the output gap and its evolution over time, giving rise to four separate phases for the economy. Section 8.3 discusses the relevance of this to monetary policy and examines how changes in policy rates are reflected in the yield curve.


  1. Hodrick, Robert J., and Edward C. Prescott. 1997. “Postwar U.S. Business Cycles: An Empirical Investigation”, Journal of Money, Credit and Banking, 29(1), 1–16.CrossRefGoogle Scholar
  2. Peach, Richard, Robert Rich, and Anna Cororaton. 2011. “How Does Slack Influence Inflation?”, Federal Reserve of New York, Current Issues in Economics and Finance, 17(3).Google Scholar
  3. Shackleton, Robert. 2018. “Estimating and Projecting Potential Output Using CBO’s Forecasting Growth Model”, Congressional Budget Office, Working Paper 2018-03, February.Google Scholar

Copyright information

© The Author(s) 2018

Authors and Affiliations

  • Henrik Lumholdt
    • 1
  1. 1.Instituto de Empresa Business SchoolMadridSpain

Personalised recommendations