9.14 Implied Real Interest Rates. If the nominal interest rate is the government bond rate, and the current change in consumer prices is used as expected inflation, calculate the implied real rates of interest by currency.

A. Australian dollar real rate B. Japanese yen real rate C. U.S. dollar real rate"

Source Data abstracted from The Economist October 20, 2007 print edition. Unless otherwise noted, percentages are percentage changes over one year, Rec Qtr = recent quarter Values for 2007e are estimates or forecasts Zoom Forecasting the Pan-Pacific Pyramid: Australia, Japan and the United States Gross Domestic Product Industrial Production Unemployment Rate Country Latest Qtr Qtr* Forecast 2007e Forecast 2008 Recent Qtr Latest Australia 4.3% 3.8% 4.1% 3.5% 4.6% 4.2% Japan 1.6% -1.2% 2.0% 1.9% 4.3% 3.8% United States 1.9% 3.8% 2.0% 2.2% 1.9% 4.7% Consumer Prices Interest Rates Country Year Ago Latest Forecast 2007e 3-month Latest 1-yr Govt Latest Australia 4.0% 2.1% 2.4% 6.90% 6.23% Japan 0.9% -0.2% 0.0% 0.73% 1.65% United States 2.1% 2.8% 2.8% 4.72% 4.54% Trade Balance Current Account Current Units (per US$) Country Last 12 mos (billion $) Last 12 mos (billion $) Forecast 07 (% of GDP) Oct 17th Year Ago Australia -13.0 -$47.0 -5.7% 1.12 1.33 Japan 98.1 $197.5 4.6% 117 119 United States -810.7 -$793.2 -5.6% 1.00 1.00 Source Data abstracted from The Economist October 20, 2007 print edition. Unless otherwise noted, percentages are percentage changes over one year, Rec Qtr = recent quarter Values for 2007e are estimates or forecasts Zoom Forecasting the Pan-Pacific Pyramid: Australia, Japan and the United States Gross Domestic Product Industrial Production Unemployment Rate Country Latest Qtr Qtr* Forecast 2007e Forecast 2008 Recent Qtr Latest Australia 4.3% 3.8% 4.1% 3.5% 4.6% 4.2% Japan 1.6% -1.2% 2.0% 1.9% 4.3% 3.8% United States 1.9% 3.8% 2.0% 2.2% 1.9% 4.7% Consumer Prices Interest Rates Country Year Ago Latest Forecast 2007e 3-month Latest 1-yr Govt Latest Australia 4.0% 2.1% 2.4% 6.90% 6.23% Japan 0.9% -0.2% 0.0% 0.73% 1.65% United States 2.1% 2.8% 2.8% 4.72% 4.54% Trade Balance Current Account Current Units (per US$) Country Last 12 mos (billion $) Last 12 mos (billion $) Forecast 07 (% of GDP) Oct 17th Year Ago Australia -13.0 -$47.0 -5.7% 1.12 1.33 Japan 98.1 $197.5 4.6% 117 119 United States -810.7 -$793.2 -5.6% 1.00 1.00