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An evaluation of the forecasts of the federal reserve: a pooled approach

Author

Listed:
  • Fred Joutz

    (Department of Economics, George Washington University, Washington, DC, USA)

  • Michael P. Clements

    (Department of Economics, University of Warwick, Coventry, UK)

  • Herman O. Stekler

    (Department of Economics, George Washington University, Washington, DC, USA)

Abstract

The Federal Reserve Greenbook forecasts of real GDP, inflation and unemployment are analysed for the period 1974-1997. We consider whether these forecasts exhibit systematic bias, and whether efficient use is made of information, that is, whether revisions to these forecasts over time are predictable. Rather than analyse the forecasts separately for each horizon of interest, we discuss and implement methods that pool information over horizons. We conclude that there is evidence of systematic bias and of forecast smoothing of the inflation forecasts. Copyright © 2007 John Wiley & Sons, Ltd.

Suggested Citation

  • Fred Joutz & Michael P. Clements & Herman O. Stekler, 2007. "An evaluation of the forecasts of the federal reserve: a pooled approach," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(1), pages 121-136.
    • Handle: RePEc:jae:japmet:v:22:y:2007:i:1:p:121-136
    DOI: 10.1002/jae.954
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    References listed on IDEAS

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