Source: Regional Financial Review, April 2019
Forecast Accuracy: U.S. Macro
Forecasting the economy for 2018 had its fair share of challenges, as all the details of the fiscal stimulus were not available at the time of the December 2017 forecast. Therefore, a number of assumptions needed to be incorporated. All told, 2018’s forecast accuracy was mixed, and the ultimate grade depends on whether more emphasis is placed on GDP or on labor market indicators. GDP growth was in line with what Moody’s Analytics expected, but job growth was stronger.
Forecast Accuracy: U.S. Regional Economies
The March 2018 forecast accurately predicted the relative strength of the four regions in 2018. The West was the strongest region thanks to the robust tech sector and the rebound in energy. Despite falling short of its forecast, the South is closing the gap with the West. The Northeast and Midwest fell short of expectations.
Forecast Accuracy: U.S. Housing
Overall, 2018 forecasts of house price indexes underestimated the actual house price growth nationally and across U.S. regions. The house price forecasts in 2018 were slightly less accurate than the 2017 forecasts.