Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/108578
Authors: 
Altug, Sumru
Uluceviz, Erhan
Year of Publication: 
2011
Series/Report no.: 
Koç University-TÜSİAD Economic Research Forum Working Paper Series 1134
Abstract: 
This paper develops a set of leading indicators of industrial production growth and consumer price inflation for the period 2001-2010. The choice of indicators is based on pseudo out-of-sample forecasting exercise implemented by Stock and Watson (2003), amongst others. We find that asset prices that reflect expectational factors or interest rates that capture the costs of borrowing for the Turkish economy tend to have the greatest predictive power for future real activity and inflation. Our findings provide evidence on the factors determining real activity and inflation in a period of disinflation and normalization for the Turkish economy.
Subjects: 
Real activity
inflation
leading indicators
out-of-sample forecasting
combination forecasts
inflation targeting
Turkey
JEL: 
E1
E32
E37
E58
F43
O52
Document Type: 
Working Paper

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