Unobservable indicators like the output gap, which plays e.g. a central role in neo-keynesian recommendations for monetary policy, are generally known to be very difficult to estimate in real time.

The problem is that an unobservable and imprecise variable – whose estimates are too inexact and volatile to provide more than a rough roadmap for a country’s journey toward fiscal rectitude – has become part of an international treaty and the national rules (sometimes of constitutional status) through which it is implemented.

Unobservable in sentence

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