Author(s)

Ahn, Young Bin

 

Abstract

We evaluate the directional accuracy of inflation forecasts based on the survey data of urban savings account holders in China. By using a new market-timing test, we show that the urban consumers' expectations of inflation are not as useful predictor of the overall consumer price index (CPI) and the urban household CPI (U-CPI) in China. However, after our in-depth analysis using the inflation rate of each cagtegory in the U-CPI basket, we find that the consumers' forecasts are useful in predicting the movement of the residence component in the U-CPI basket since the third quarter of 2009.

Keywords

Chinese urban cosnumers' inflation forecasts, directional analysis, residence category, survey data, urban household consumer price index (CPI) basket


Get Full Article

Ahn, Young Bin: Directional Accuracy of Urban Consumers’ Inflation Forecasts in China, in: Emerging Markets  Finance and Trade, Vol. 54 (6), pp. 1414 - 1424, 2018