Publication Type

Journal Article

Version

publishedVersion

Publication Date

4-2023

Abstract

This Special Feature considers how accurately professional forecasters have predicted GDP growth and inflation in Singapore, especially during rare events such as the Global Financial Crisis (GFC) and COVID-19. It also illustrates the value of forecast probability distributions in inferring forecasters’ uncertainty when making predictions, and the degree of consensus between projections from different forecasters. The authors find that one-year ahead forecast errors for GDP growth and inflation increased during the GFC and the COVID-19 pandemic. While professional forecasters did not appear to have followed the Government’s forecasts when predicting growth during the GFC, they may have exhibited ”leader-following” behaviour when forecasting growth and inflation during COVID-19. Similarly, forecasters appear to exhibit herding behaviour during both crises. During the pandemic, moreover, the rise in forecast uncertainty was traced to a more volatile economic policy environment. Collectively, the paper’s results suggest that inflation expectations were well-anchored throughout the sample period.

Keywords

Professional Forecasters, Behavioural Explanations, Forecast Probability Distributions

Discipline

Asian Studies | Macroeconomics

Research Areas

Macroeconomics

Publication

Macroeconomic Review

Volume

XXII

Issue

1

First Page

101

Last Page

110

ISSN

0219-8908

Publisher

Monetary Authority of Singapore

Copyright Owner and License

Authors

Additional URL

https://www.mas.gov.sg/publications/macroeconomic-review/2023/volume-xxii-issue-1-apr-2023

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