Exploiting payments to track Italian economic activity: the experience at Banca d’Italia

Valentina Aprigliano, Guerino Ardizzi (), Alessia Cassetta (), Alessandro Cavallero (), Simone Emiliozzi, Alessandro Gambini (), Nazzareno Renzi () and Roberta Zizza
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Guerino Ardizzi: Bank of Italy
Alessia Cassetta: Bank of Italy
Alessandro Cavallero: Bank of Italy
Nazzareno Renzi: Bank of Italy

No 609, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: This paper provides an overview of how information on payments has been recently exploited by Banca d’Italia staff for the purposes of tracking economic activity and forecasting. In particular, the payment data used for this work are drawn from the payment systems managed by Banca d’Italia (BI-COMP and TARGET2) and from the Anti-Money Laundering Aggregate Reports submitted by banks and by Poste Italiane to the Banca d’Italia’s Financial Intelligence Unit (Unità di Informazione Finanziaria, UIF). We show that indicators drawn from these sources can improve forecasting accuracy; in particular, those available at a higher frequency have proved crucial to properly assessing the state of the economy during the pandemic. Moreover, these indicators make it possible to assess changes in agents’ behaviour, notably with reference to payment habits, and, thanks to their granularity, to delve deeper into the macroeconomic trends, exploring heterogeneity by sector and geography.

Keywords: short term forecasting; high-frequency data; payment systems; TARGET2; money laundering; COVID-19 (search for similar items in EconPapers)
JEL-codes: C53 E17 E27 E32 E37 E42 (search for similar items in EconPapers)
Date: 2021-03
New Economics Papers: this item is included in nep-big, nep-eec, nep-mac, nep-mon and nep-pay
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Persistent link: https://EconPapers.repec.org/RePEc:bdi:opques:qef_609_21

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