Compared to traditional benchmarks, this line of research has shown that generalised Phillips curve models exhibit a remarkable improvement in forecasting ability. 11 On the theoretical front, there was a growing realisation that the research program launched by Kydland and Prescott was facing fundamental problems.
As at the end of March 2007, foreign exchange reserves further rose to USD 10.3 billion. It is considered substantial for a small city with a population of 500 000. The management of the reserves of the Macao SAR is in the good hands of my colleagues in the Monetary Authority.