Turkey | Investment in “Real Time” and “High Definition”: A Big Data Approach

Summary

Presentation released by BBVA Research at Banca d’Italia and Federal Reserve Board Joint Conference, Nontraditional Data & Statistical Learning with Applications to Macroeconomics.

Key points

• Key points:
• The high uncertainty triggered by the Covid-19 crisis has stressed the need to monitor the evolution of the economy in “real time”. These efforts have been materialized in several ways: focusing on timely, alternative indicators, developing higher frequency models and developing New Big Data Indicators.
• Through the analysis of the firm-to-firm transactions we extend our project of national accounts in real time & high definition to Investment. We approximate investment demand in one type of asset taking into account the aggregate flows or transactions done from any firm or individual to the sector which produce the fixed assets.
• We present a novel approach to estimate Investment in “Real Time & High Definition” from the analysis of a Bank´s Big Data (BBVA).
• We cross validate the results through the high correlations with national accounts and high frequency proxies for Turkey and other countries.
• The Investment index improves the properties of a Standard Nowcasting Model in terms of forecasting accuracy, anticipation and news.

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