• Loading stock data...
Economy Banking Featured Finance

Lumpy forecasts: Rational inaction in professional forecasting

Forecasts from professionals (economists, analysts, brokers, academics) are a key input into economic decision-making. This column highlights that professional forecasts are ‘lumpy’, often remaining unchanged for several periods, before shifting in large, infrequent jumps. It argues that this reflects ‘rational inaction’, as frequent adjustments or constant swings could undermine credibility. It suggests a natural distinction […]