## Nowcasting and Near-Term Forecasting Cambodia’s Economy

_IMF Working Papers, July 12, 2024_

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## Bibliographic details
- Authors: Dyna Heng, Fei Han, Sovanney Chey, Raksmey Uch, Dy Kuchsa, Pholla Phork
- Published: July 12, 2024
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798400280931.001

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### Overview
- Purpose: Assess the current state of Cambodia’s economy and forecast the economic outlook in the next few quarters to inform policymakers.
- Core contribution: Presents a suite of models with an integrated approach to nowcasting and near-term forecasting for Cambodia, demonstrating use of high-frequency data in a context with limited and lagged official data.

### Methodology and Model Components
- Historical quarterly GDP estimation:
  - Estimate historical quarterly GDP using information extracted from high-frequency indicators to construct a quarterly nowcasting model.
- High-frequency current-activity forecasting:
  - Forecast current economic activities using high-frequency data such as credit, export, tourist arrival, foreign reserves, and trading partner’s GDP.
- Inflation forecasting:
  - Present inflation forecasting models tailored for Cambodia.
- Vector autoregression (VAR) forecasting:
  - Present a vector autoregression model to forecast Cambodia’s GDP in the next few quarters using global forecasts of China’s and US’s economy as well as oil and rice price.

### Key Findings and Analytical Insights
- Demonstrates that high-frequency data sets can be utilized effectively to assess current economic activities in countries with limited and lagged official data.
- Integrates multiple data sources (credit, export, tourist arrival, foreign reserves, trading partner GDP, oil and rice prices) to improve short-term tracking and forecasting of Cambodia’s GDP and inflation.

### Relevance for Policy and Practitioners
- Provides tools for policymakers to:
  - Assess current-quarter economic conditions in near real time.
  - Produce short-horizon forecasts of GDP and inflation to inform policy decisions.
- Emphasizes the value of incorporating global conditions (China and US GDP forecasts) and commodity prices (oil and rice) into domestic short-term forecasting frameworks.

### Scope and Metadata
- Authors: Dyna Heng, Fei Han, Sovanney Chey, Raksmey Uch, Dy Kuchsa, Pholla Phork
- Date: July 12, 2024
- Length: 46 pages
- Series: IMF Working Paper No. 2024/147
- DOI: https://doi.org/10.5089/9798400280931.001
- Subjects: Credit, Econometric analysis, Economic forecasting, Exports, Inflation, International trade, Money, Prices, Vector autoregression
- Keywords: Cambodia, Cambodia's GDP, Credit, Developing countries, Exports, Global, high-frequency data set, Inflation, inflation forecasting model, near-term forecasting Cambodia's economy, Nowcasting, Nowcasting GDP, Vector autoregression

*IMF Working Paper No. 2024/147 (July 12, 2024) by Dyna Heng, Fei Han, Sovanney Chey, Raksmey Uch, Dy Kuchsa, and Pholla Phork.*

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_Source: https://www.imf.org/en/publications/wp/issues/2024/07/11/nowcasting-and-near-term-forecasting-cambodias-economy-551420_