Definition: Nowcasting

Category: Statistical methodologies

Rapid estimate produced by a statistical authority or an institution outside a statistical system during the current reference period T (or very close to its end "the present") for a hard economic variable of interest observed for the same reference period T. A nowcasting makes use of all available information becoming available between T-1 and T until the estimation time. Statistical or econometric models, different from the ones used for the regular production process are considered using either hard, soft, unconventional and/or financial data.

A nowcasting is then a particular case of ex-ante forecasts of the present using the real time data flow available between T-1 and T. When the information set includes data up to T-1 only, we will have an ex-ante forecast. Nowcasting differ from advance estimates because the latter is obtained using the same scheme (adherence principle) as the one used for the regular production process.

It is worth to notice that the nowcasting term is used in many different ways in scientific papers. The definition provided here is functional to the production of rapid estimates by statistical institutions. http://ec.europa.eu/eurostat/product?code=KS-GQ-17-008&mode=view