Can news help measure economic sentiment? An application in COVID-19 times

Pablo Aguilar, Corinna Ghirelli, Matías Pacce and Alberto Urtasun

Economics Letters, 2021, vol. 199, issue C

Abstract: We construct a new newspaper-based sentiment indicator for Spain that allows to monitor economic activity in real-time. As opposed to survey-based confidence indicators that are released at the end of the month, our indicator can be constructed on a daily basis. We compare our index with the popular Economic Sentiment Indicator of the European Commission and show that ours performs significantly better in nowcasting the Spanish GDP. Moreover, it proves to be helpful to predict the current COVID-19 recession from an earlier date.

Keywords: Nowcasting; GDP; Recession; Real-time; Textual analysis; Sentiment indicators; Soft indicators (search for similar items in EconPapers)
JEL-codes: C23 C53 E32 E37 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:199:y:2021:i:c:s0165176521000070

DOI: 10.1016/j.econlet.2021.109730

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