RavenPack EDGE: The most advanced, multilingual NLP technology on the planet

Find out more
Insights

research

Macro

Nowcasting China's Economic Activity with Real-time News Sentiment

February 07, 2023

Using a cutting-edge approach that incorporates at a large scale low-frequency macro-economic variables with high-frequency sentiment indicators, RavenPack is able to nowcast China's macroeconomic indicators with enhanced accuracy and timeliness.

Nowcasting models are an invaluable tool for policymakers and financial professionals, providing timely updates on key economic indicators like gross domestic product (GDP), inflation, employment, and industrial production.

Leveraging RavenPack EDGE Analytics, a state-of-the-art nowcasting model is applied to predict Chinese macroeconomic activity in real time, demonstrating its potential as a powerful forecasting tool.

Observations reveal:

  • The addition of RavenPack Analytics to the model improves performance in terms of the out-of-sample forecasting error by up to 7%, depending on the prediction period.

  • RavenPack Analytics is valuable in terms of timeliness and accuracy, particularly when there is a lack of macroeconomic data.

  • RavenPack Analytics aggregated with a decaying factor over a short horizon (30 days) provides the best contribution as recent events are emphasized.

The evolution of the 2020-Q3 YoY% GDP prediction for China of the NC-RP model

Request White Paper

Request White Paper

We will process your personal data with the purpose of managing your personal account on RavenPack and offering our services. You can exercise your rights of access, rectification, erasure, restriction of processing, data portability and objection by emailing us at privacy@ravenpack.com. For more information, you can check out our Privacy Policy.

Related Articles

Hedging Inflation Risk: A Nowcast Approach Under Risk Target Constraints

Our multi-asset allocation strategy based on inflation nowcasts and RavenPack sentiment analytics outperforms the S&P 500 and stabilizes volatility. With real Sharpe ratios of up to 1.25 and a risk control approach, it delivers a compelling inflation hedge for investors.

Using Sentiment Data to Build an Inflation-based Allocation Strategy

High inflation has returned in developed markets after decades of lying low. In our latest paper, we show how to build an inflation-based asset allocation strategy using sentiment data and we illustrate that sentiment-based strategies outperform models that depend merely on past observed inflation values.

From Real-Time News Sentiment to Economic Activity Nowcasting: BRIS Counties

RavenPack presents a macroeconomic nowcasting model that leverages its EDGE data platform to predict real-time economic activity of four important emerging market economies: Brazil, Russia, India and South Africa.

Load More

Request a Trial

Fill out the form below and see RavenPack in action.