Archive for the ‘Fed’ Category

How well does the Fed forecast?

February 2, 2008

The Federal Reserve puts together a forecast of both current and future GDP and inflation for each FOMC meeting. A new paper by Faust and Wright looks at the Fed’s track record. They find that while the Fed beats the competition when forecasting current and future inflation, and current GDP, they do worse than a simple autoregressive model when forecasting future GDP.