Macroeconomic Modelling, Forecasting and Policy Analysis
Our world-class economists at the Melbourne Institute conduct in-depth analysis of domestic and international fiscal and monetary policies, evaluating their impact on the state of the Australian economy.
We use quantitative analysis to explore a range of macroeconomic issues, taking an economy-wide perspective to examine economic trends and movements. Our research focuses on economic modelling of linkages in the economy, analysing business cycles and investigating various aspects of the economic health of the nation, such as interest and exchange rates.
Our researchers have high-level skills in applied macroeconomic analysis, especially in the application of macroeconometric techniques and computational macroeconomic methodologies to economic data.
We are trusted experts in macroeconomic analysis which has led to a longstanding industry partnership with Westpac, and the annual convening of academics, policy-makers and researchers from central banks and government treasuries in an engaged discussion on the state of the Australian economy at the Melbourne Institute Macroeconomic Policy Meeting.
Expectations and forecasting
The Melbourne Institute’s Consumer Attitudes, Sentiments and Expectations in Australia (CASiE) Survey is a monthly study of Australian households that provides valuable and timely signals about consumer perceptions of the state of the economy. Since 1974, CASiE has gauged public opinion on topics such as the state of the Australian economy, prospects for employment and expectations of price changes.
Data from the CASiE Survey is used to compile the following macroeconomic reports:
- Westpac–Melbourne Institute Survey of Consumer Sentiment
- Westpac–Melbourne Institute Survey of House Price Expectations
- Westpac–Melbourne Institute Survey of Unemployment Expectations
- Melbourne Institute Survey of Consumer Inflationary and Wage Expectations
Our researchers also apply sampling methodology to create a Monthly Inflation Gauge that complements the quarterly Consumer Price Index produced by the Australian Bureau of Statistics.
We also monitor the state of the Australian economy, forecasts key macroeconomic variables and our annual review of the Australian economy is published in the March Issue of the Australian Economic Review each year.
The impact of global uncertainty
Amid heightened uncertainty about the future, our researchers are investigating the macroeconomic consequences of disruptions in financial markets and other uncertainty shocks such as political upheaval. Uncertainty plays a crucial role in the purchasing and investment decisions of households and businesses, which, in turn, impacts a country's business cycle and overall economy.
We’re analysing the impact of governmental policies intended to maintain stability in times of financial uncertainty, as well as the impact of shocks on employment dynamics.
Housing and macroeconomic policy
After the global financial crisis, many countries introduced macroprudential policies, such as ceilings for new mortgages and higher debt-to-loan ratios, with the aim of reducing risk across the entire financial system and to prevent future crises. Our researchers are investigating the macroeconomic consequences of such policies, with the aim of providing robust, empirically-based advice to policymakers about the best way to conduct macroprudential policies.
We also investigate developments in the Australian housing, labour and financial markets, and publish our analyses in various international and Australian journals.
Program Coordinator: Professor Guay Lim
Partnerships and Funding
This program is funded through grants and research contracts provided by a variety of sources, including the ARC, the Reserve Bank of Australia and Westpac.
The Melbourne Institute Macroeconomic Policy Meeting is sponsored by the Reserve Bank of Australia, the Reserve Bank of New Zealand and the Australian and New Zealand Treasuries.