Conditional Macroeconomic Forecasts: Disagreement, Revisions and Forecast Errors

Using data from the European Central Bank's Survey of Professional Forecasters, we analyze role ex-ante conditioning variables for macroeconomic forecasts. In particular, test to which extent heterogeneity, updating and ex-post performance predictions inflation, real GDP growth unemployment rate are related assumptions about future oil prices, exchange rates, interest rates wage growth. Our findings indicate that inflation forecasts closely associated with price expectations, whereas expected used primarily predict output unemployment. Expectations also matter forecasts, albeit less so than prices rates. We show survey participants can considerably improve forecast accuracy outcomes by reducing prediction errors external conditions. results contribute a better understanding expectation formation process experts.