Forecasting gdp growth in the US, Japan and the EU on the basis of leading indicators

This report presents leading indicators of real gdp-growth for the United States, Japan and 7 EU member countries. These indicators make use of business cycle indicators developed at the Bank, together with information contained in financial and monetary variables like the yieldcurve, the money stock and share prices. The study shows that the forecast quality of these indicators of gdp-growth - which have a horizon up to 1 year - is overall satisfactory, and is moreover comparable with those from projections by macroeconomic models. Because of this feature and the fact that gdp-growth indicators can be updated instantaneously, this type of information is quite interesting for policymakers as well as for model users.