Taylor Rule Simulator
Explore how different policy weightings would have changed the ECB's interest rate.
Formula: i = r* + π + απ(π - π*) + αy(y)
Model Weights
Inflation Weight (απ)1.50
Output Gap Weight (αy)0.50
Natural Rate (r*)1.00%
Insight
Balanced: You are following the classic 1993 Taylor rule.
About the Taylor Rule
The Taylor rule is a monetary policy rule that stipulates how much a central bank should change the nominal interest rate in response to changes in inflation and economic activity. This simulator lets you test alternative histories for the Eurozone.
Method
Rule-based Proxy
Data
ECB/Eurostat
Software
React & Chart.js
Precision
Empirical Match