Nowcasting economic activity in European regions using a mixed-frequency dynamic factor model

Luca Barbaglia, Lorenzo Frattarolo, Niko Hauzenberger, Dominik Hirschbühl, Florian Huber, Luca Onorante, Michael Pfarrhofer and Luca Tiozzo Pezzoli

International Journal of Forecasting, 2026, vol. 42, issue 2, 657-672

Abstract: Timely and accurate information about regional economic conditions can be essential for planning, implementing, and evaluating locally targeted economic policies. However, European regional accounts for output are published at an annual frequency with a two-year delay. To obtain robust and more timely measures in a computationally efficient manner, we propose a mixed-frequency dynamic factor model that accounts for national information to produce high-frequency estimates and reliable nowcasts of regional gross value added (GVA) in more than 150 regions across 13 European countries.

Keywords: Euro area; Factor models; Mixed-frequency; Nowcasting; Regional data (search for similar items in EconPapers)
Date: 2026
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Working Paper: Nowcasting economic activity in European regions using a mixed-frequency dynamic factor model (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:intfor:v:42:y:2026:i:2:p:657-672

DOI: 10.1016/j.ijforecast.2025.09.006

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