Nowcasting UK consumption and investment with monthly output components and realtime indicators

Ana Beatriz Galvão and Rory Macqueen
Authors registered in the RePEc Author Service: Paul Mizen

Discussion Papers from Economic Statistics Centre of Excellence

Abstract: The first ONS estimates of UK Investment and Consumption growth are revised to incorporate data that was not previously available. We draw on a large set of traditional and alternative economic indicators to nowcast investment and aggregate consumption growth. We compare the nowcast performance of mixed frequency models with the ONS first estimates for both macroeconomic variables. When predicting the latest estimate, the nowcasting models cannot improve over the ONS’ first estimate. Nonetheless, some classes of predictors can assist in improving early estimates under some circumstances. In particular, monthly sectoral growth data and real-time data on vacancies would offer potential timely insights into both consumption and investment movements during volatile periods such as 2020-2021.

Keywords: MIDAS; nowcasting; consumption; investment MIDAS; nowcasting; consumption; investment (search for similar items in EconPapers)
JEL-codes: C53 (search for similar items in EconPapers)
Date: 2023-06-15
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Persistent link: https://EconPapers.repec.org/RePEc:eoe:escoed:escoe-dp-2023-10

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