Macro Technical Paper No.3
By Davide Brignone and Michele Piffer
We present a Structural VAR (SVAR) model for the UK economy, which is part of a wider modelling toolkit used to inform monetary policymaking. The model includes eight global and UK macroeconomic variables, and identifies a set of global and domestic shocks. We describe standard model outputs, including impulse responses, forecast-error variance decompositions, and historical decompositions. We then describe how the model can be used on a round-by-round basis to inform policy discussions by providing a structural narrative for forecast revisions.
A structural VAR model for the UK economy 