Measuring economic outlook in the news

Elliot Beck, Franziska Eckert, Linus Kühne, Helge Liebert and Rina Rosenblatt-Wisch

No 2026-04, Working Papers from Swiss National Bank

Abstract: We develop a resource-efficient methodology for measuring economic outlook in news text that combines document embeddings with synthetic training data generated by large language models. Applied to 27 million news articles, the resulting indicator significantly improves GDP growth forecast accuracy and captures sentiment shifts weeks before official releases, proving particularly valuable during crises. The indicator outperforms both survey-based benchmarks and traditional dictionary methods and is interpretable, allowing identification of specific drivers of economic sentiment. Our approach addresses key institutional constraints: it performs sentiment classification locally, enabling analyses of proprietary news content without transmission to external services while requiring minimal computational resources compared to direct large language model classification.

Keywords: Sentiment analysis; Economic outlook; Forecasting; Big data; Large language models; Natural language processing; Neural networks (search for similar items in EconPapers)
JEL-codes: C45 C55 E66 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2026
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