In this study, we set up a framework to generate the forecasts of growth in aggregate demand and its components using real-time data. In general, these forecasts (for 1983-2008) accurately predict directional change under symmetric loss and are thus of value to a user who assigns similar cost...

In this study, we set up a framework to generate the forecasts of growth in aggregate demand and its components using real-time data. In general, these forecasts (for 1983-2008) accurately predict directional change under symmetric loss and are thus of value to a user who assigns similar cost...

Utilizing comparable time-series forecasts as benchmarks, we document the “weak” and “stronger” rationality of professional forecasts of growth in business investment for 1982–2009. Consistent with these findings, the forecasts are directionally accurate and imply symmetric loss.