Central Bank to overhaul forecast skills after missing recession and house crash
HAVING failed to predict the bitter recession, the banking crisis and the collapse in house prices, the Central Bank is to overhaul its forecasting skills.
The decision to overhaul its tipping skills is “part of our normal re-evaluation”, according to the Central Bank.
“This issue is recognised in the Strategic Plan for 2010- 2012. One of the key elements is a commitment to further enhance our assessment of financial sector developments and to feed that into our broader economic analysis and forecasting.
“Work on this is already under way and we intend to expand our published research output in this area as well as redirecting existing resources.
“We are adapting and adding to our existing approaches, which include the use of models,” a spokesman for the Central Bank added.
However, the bank is not hiring a rake of smart young economists or investing in some of the latest financial modelling products. We’re doing it on the cheap. “There is no explicit budget for this as the benefit to the forecasting process will come as a result of work we will be doing in any event as part of the planned broadening out of our financial stability analysis,” the Dame Street institution noted.
“The resources we need to do this work will be people rather than expensive systems — but the output produced by these people will be used for a lot more than for just forecasting.”