Macro Musings with David Beckworth cover image

Gianluca Benigno on the Basics and Policy Functionality of R** and the Dollar’s Imperial Circle

Macro Musings with David Beckworth

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The Financial Instability Real Interest Rate R-Star

R star is an equilibrium rate at which you're closing the output gap and there are no inflationary pressure. It seemed to be more important during the decade after the great recession because rates were so low. So that's where the idea came for thinking about R star or R star star, as you say. We actually call it R double star from here on out.

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