Title: Back to the present: Learning about the Euro Area through a now-casting model
Authors: Danilo Cascaldi-Garcia - Federal Reserve Board (United States) [presenting]
Thiago Ferreira - Federal Reserve Board (United States)
Domenico Giannone - FED New York (United States)
Michele Modugno - Federal Reserve Board (United States)
Abstract: A model is built for now-casting economic conditions in the euro area and its three largest member countries---Germany, France, and Italy. The model incorporates all market moving indicators in real time. The model provides accurate predictions of economic conditions on average over the most recent 15 years, and during three historical episodes of high economic uncertainty: the Global Financial Crisis, the European sovereign debt crisis, and the onset of the Great Lockdown. Since hard data are released with a substantial delay, business sentiment surveys data provide the most informative signal of the state of the economy in real time.