Based on national surveys, households’ expectations of growth have worsened, while their inflation expectations have risen. This suggests that people are expecting to see their real 2/5  BIS central bankers' speeches  income (i.e. their income adjusted for inflation) squeezed. Households are likely to save less, which should absorb part of this shock, but they have also revised down their spending plans.
November 12, 2019  Slide 2 of 8  Figure 3: Estimates of r*  Note: The foreign r* shown in the chart captures the comovement of r*in Canada, the euro area, and the United Kingdom with the U.S. r*. Specifically, the foreign r* is a linear combination of the r*s for Canada, the euro area, and the United Kingdom.