An economic forecast is a prediction of future economic activity. It typically consists of a set of values for the future, usually expressed in terms of an average over some period or as a range, and the predicted rate at which those quantities will change. The values are often taken from a variety of sources and may be assumed or predicted in some way. A number of studies have found that a great deal of the accuracy of professional economic forecasts declines as a recession approaches; this is because the economy behaves differently at these times, so it is harder to predict.
A wide variety of time series models and techniques are employed in the field of economic forecasting, with innovations occurring at a rapid pace. These techniques range from simple, statistically-based methods to more sophisticated econometric models.
Economic growth is expected to slow this year and next amid a sharp rise in trade barriers and elevated policy uncertainty. A more sustainable path would require greater multilateral cooperation and restored fiscal responsibility, paired with reforms that boost productivity, support private investment, and help reduce persistent labor market rigidities. But, for the foreseeable future, global growth remains below potential and well below the levels needed to drive poverty reduction and shared prosperity.
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