Nowcasting GCC GDP: A Machine Learning Solution for Enhanced Non-Oil GDP Prediction

IMF Working Papers, December 19, 2025

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Presents a machine learning–based nowcasting framework for estimating quarterly non-oil GDP growth in the Gulf Cooperation Council (GCC) countries.
Leverages machine learning models tailored to each country to produce timely, sector-specific estimates.
Aims to enhance granularity, responsiveness, and transparency of short-term forecasts to support faster, data-driven policy decisions across the GCC.

Integrates a broad range of high-frequency indicators—including real activity, financial conditions, trade, and oil-related variables.
Incorporates high-frequency, cross-border indicators to move beyond single-model methodologies.

Tailored data integration strategy that broadens and automates the use of high-frequency indicators.
Novel application of Shapley value decompositions to:
- Enhance model interpretability.
- Guide iterative selection of predictive indicators.
Framework flexibility designed to account for:
- The region’s unique economic structures.
- Ongoing reform agendas.
- Spillover effects of oil market volatility on non-oil sectors.

Advances the nowcasting literature for the MENA region by combining richer high-frequency datasets with country-specific machine learning models.
Improves sector-specific and short-term estimates of non-oil GDP growth in GCC countries.
Enhances the transparency and interpretability of model outputs through Shapley value decompositions.

Enables faster, data-driven policy decisions strengthening economic surveillance and enhancing policy agility across the GCC.
Suitable for use amid a rapidly evolving global environment where oil market volatility affects non-oil sectors.

Authors: Greta Polo, Yuan Gao Rollinson, Yevgeniya Korniyenko, Tongfang Yuan
Date: December 19, 2025
Series: Working Paper No. 2025/268
Issue: 268
Volume: 2025
Pages: 36
DOI: https://doi.org/10.5089/9798229031851.001
Stock No: WPIEA2025268
ISBN: 9798229031851
ISSN: 1018-5941
Subjects: Commodities, Economic forecasting, Oil, Oil prices, Prices
Keywords: Caribbean, Central America, Central Asia, GCC, Global, growth in the Gulf Cooperation Council, IMF working papers, Machine Learning, machine learning model, Middle East, Non-oil Growth, Nowcasting, nowcasting framework, Nowcasting Gcc, Oil, Oil prices, South America, Southeast Asia

IMF Working Papers — Nowcasting GCC GDP: A Machine Learning Solution for Enhanced Non-Oil GDP Prediction