{ "title": "Looking for Underlying Structure in WEO Forecasts", "publication": "IMF Working Papers, July 31, 2026", "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363", "canonical": "https://www.imf.org/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363", "overlayPath": "/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363/index.md", "summary": "This paper examines the statistical properties of the IMF’s World Economic Outlook (WEO) projections over 1999–2023 for 29 economies. The optimism of WEO growth forecasts is well established; we confirm it and look behind it at two features of how the forecasts are built.", "sections": [ { "heading": "Overview", "content": "- Author: Yurii Sholomytskyi\n- Date: July 31, 2026\n- Scope: Examines statistical properties of IMF World Economic Outlook (WEO) projections over 1999–2023 for 29 economies.\n- Publication: IMF Working Papers, Working Paper No. 2026/164, Issue 164, Volume 2026, Pages: 36.\n- DOI: https://doi.org/10.5089/9798229056113.001\n- Stock No: WPIEA2026164\n- ISBN: 9798229056113\n- ISSN: 1018-5941\n- Subjects: COVID-19; Economic theory; Financial sector policy and analysis; Health; Inflation; Inflation targeting; Monetary policy; Prices; Spillovers; Supply shocks\n- Keywords: A.IX robustness; COVID-19; data construction; Forecast error; Forecast fragmentation; Global; IMF; IMF working papers; IMF's World Economic Outlook; Inflation; Inflation targeting; Optimism bias; Spillovers; Supply shocks; World Economic Outlook" }, { "heading": "Key Findings", "content": "- The optimism of WEO growth forecasts is reaffirmed for the 1999–2023 sample across 29 economies.\n- Forecast fragmentation:\n - The growth of the systemic economies (the United States and China) appears underutilized in the projections.\n - Forecasts embed less of the cross-country growth comovement present in the data; this gap is termed \"forecast fragmentation.\"\n - Forecast fragmentation did not narrow over the sample period.\n- Growth–inflation link:\n - The conditional growth–inflation link present in the historical data is weakly represented in the projections." }, { "heading": "Interpretation and Analysis", "content": "- The identified patterns point to limitations in how expert-driven WEO projections incorporate measurable cross-country comovements and real–nominal linkages observed in historical data.\n- The weak representation of the conditional growth–inflation relationship suggests that projections may underweight empirically observed real–nominal interactions when forming medium-term forecasts." }, { "heading": "Policy Recommendations and Implications", "content": "- Structural models are proposed as a useful complement to expert judgment:\n - Such models can verify cross-country and real–nominal linkages through estimation.\n - Structural-model-based checks could serve as a baseline for medium-term anchors and help detect or constrain optimism bias in forecasts.\n\nSource: IMF Working Paper by Yurii Sholomytskyi, \"Looking for Underlying Structure in WEO Forecasts\", IMF Working Papers 2026, 164 (2026); DOI: https://doi.org/10.5089/9798229056113.001; available at https://www.imf.org/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363\n\n---\n\n Content in this bundle\n\n- Working Paper\n - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363" } ], "bullets": [ "[Markdown version](/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363/index.md)", "[Structured JSON version](/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363/index.json)", "[Bundle manifest](/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363/bundle-manifest.json)", "Authors: Yurii Sholomytskyi", "Published: July 31, 2026", "Series: IMF Working Papers", "DOI: https://doi.org/10.5089/9798229056113.001", "Author: Yurii Sholomytskyi", "Date: July 31, 2026", "Scope: Examines statistical properties of IMF World Economic Outlook (WEO) projections over 1999–2023 for 29 economies.", "Publication: IMF Working Papers, Working Paper No. 2026/164, Issue 164, Volume 2026, Pages: 36.", "DOI: https://doi.org/10.5089/9798229056113.001", "Stock No: WPIEA2026164", "ISBN: 9798229056113", "ISSN: 1018-5941", "Subjects: COVID-19; Economic theory; Financial sector policy and analysis; Health; Inflation; Inflation targeting; Monetary policy; Prices; Spillovers; Supply shocks", "Keywords: A.IX robustness; COVID-19; data construction; Forecast error; Forecast fragmentation; Global; IMF; IMF working papers; IMF's World Economic Outlook; Inflation; Inflation targeting; Optimism bias; Spillovers; Supply shocks; World Economic Outlook", "The optimism of WEO growth forecasts is reaffirmed for the 1999–2023 sample across 29 economies.", "Forecast fragmentation:", "Growth–inflation link:", "The identified patterns point to limitations in how expert-driven WEO projections incorporate measurable cross-country comovements and real–nominal linkages observed in historical data.", "The weak representation of the conditional growth–inflation relationship suggests that projections may underweight empirically observed real–nominal interactions when forming medium-term forecasts.", "Structural models are proposed as a useful complement to expert judgment:", "**Working Paper**" ], "related": [ { "title": "Working Paper", "role": "paper", "sourceUrl": "https://www.imf.org/-/media/files/publications/wp/2026/english/wpiea2026164-source-pdf.pdf", "summary": { "path": "/-/media/files/publications/wp/2026/english/wpiea2026164-source-pdf.pdf.md", "mime": "text/markdown" }, "binary": { "path": "/-/media/files/publications/wp/2026/english/wpiea2026164-source-pdf.pdf", "mime": "application/pdf" } } ], "alternates": { "markdown": "/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363/index.md", "json": "/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363/index.json", "bundleManifest": "/en/publications/wp/issues/2026/07/31/looking-for-underlying-structure-in-weo-forecasts-578363/bundle-manifest.json" }, "generatedAtUtc": "2026-09-17T03:52:50.700Z" }