Forecasting GDP with New MIPred Inputs and May Social Security Data
The independent analytics agency updated its real time GDP forecasting model, now called MIPred, after incorporating the latest findings on Social Security participation for May. The revisions come as the model continues to adapt to fresh indicators that flow into the data stream, reflecting a commitment to real time economic assessment and timely policy relevance.
Despite the May data being preliminary and subject to revision, AIReF indicates a possible 1 percent growth rate for the second quarter of 2023, with a separate 2.3 percent figure cited as a reference point in internal discussions. The 1 percent projection signals that the GDP index would exceed the level reached before the Covid-19 outbreak in the final quarter of 2019, signaling a return to pre pandemic economic strength in the near term. AIReF emphasizes that the numbers are contingent on forthcoming updates as new indicators are added to the model.
The current forecast uses data for the second quarter of 2023 and includes 28.6 percent weight from May alongside 57.1 percent from April and 0 percent from June at this stage. The model is designed to incorporate additional indicators as they are released, with particular attention to the final quarterly GDP data from INE, electricity consumption statistics, and the Industrial Production Index among others. These forthcoming releases are expected to refine the trajectory and help explain the economic momentum in the quarter. Such indicators will provide a fuller view of how industrial activity, energy use, and consumer behavior are shaping growth.
As the model evolves, analysts and policymakers will watch how the integration of real time data affects forecasts. The strategy behind MIPred is to blend high frequency signals with official quarterly benchmarks, creating a more responsive tool for assessing performance across sectors. The May Social Security participation figures are a key input in this process, offering a gauge of labor market participation and potential effects on domestic demand. Ongoing revisions and updates will continue to calibrate the balance between immediacy and reliability in the forecast, ensuring that the projection remains aligned with the broader economic environment.