Working Papers,
National Institute of Economic Research

Abstract: One-year-ahead forecasts by the OECD and by national institutes of GDP growth and inflation in 13 European countries are analysed. RMSE was large: 1.9 % for growth and 1.6 % for inflation. Six (11) OECD and 10 (7) institute growth forecast records were significantly better than an average growth forecast (the current year forecast). All full record-length inflation forecasts were significantly better than both naive alternatives. There was no significant difference in accuracy between the forecasts of the OECD and the institutes. Two forecasts were found to be biased and one had autocorrelated errors. Directional forecasts were significantly better than a naive alternative in one-half of the cases. Overall, inflation forecasts were significantly more accurate than growth forecasts, and in contrast to growth forecasts, they generally improved over time. This has implications for economic policy. Positively biased revisions reveal large errors in data.

Keywords: Forecast accuracy; Directional errors; Forecast tests

44 pages, February 1, 2000

Full text files

Working-Paper-72-The...lation-Forecasts.pdf  

Download statistics

• National Institute of Economic Research
• Home page for this series

Questions (including download problems) about the papers in this series should be directed to Sarah Hegardt Grant ()
Report other problems with accessing this service to Sune Karlsson ().

RePEc:hhs:nierwp:0072This page generated on 2024-09-13 22:16:24.