Bank's risk forecasts not effective
The Bank of England's risk forecasts for inflation do not perform well, finds new research from the Deutsche Bundesbank.
The Bank's mode forecast, or central projection for inflation, is closer to the expected inflation than the actual forecast for expected inflation, known as the risk forecast.
Hence, the risk forecasts do not contain the intended information, says the article. The authors advise investors to use the Bank's mode forecast instead of the risk forecast.
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