Robust Forecasting Across Space and Time
ECRI
23-July-2008
A few years ago, the International Monetary Fund (IMF) completed a 63-country study of the ability of economists' consensus forecasts to predict recessions, as they had a well-documented reputation for predictive accuracy. Yet, the IMF succinctly concluded, "The record of failure to predict recessions is virtually unblemished." In other words, there is a near-perfect international history of failure to forecast recessions.
It is in this context that we evaluate ECRI’s leading indicator approach to economic forecasting. Our latest analysis examines the performance of selected leading indicators from the late 19th century into the early 21st century, and their ability to accurately predict recessions and recoveries in the U.S. and abroad, providing surprising insights into the robustness of ECRI’s forecasting method.
This information is excerpted from a full report issued July 18, 2008 to professional subscribers. For information on how to read the complete story and to subscribe to ECRI's services click this link.