Examining the Beliefs of Professional Forecasters

This Economic Commentary studies how professional forecasters update their forecasts in response to macroeconomic news. We find that the two most important news releases for how professionals update their short-term forecasts are the unemployment rate and the three-month Treasury bill rate. News about the unemployment rate is particularly important when updating forecasts about real GDP growth or unemployment, whereas news about the short-term Treasury bill rate tends to be more informative for revisions of inflation and three-month Treasury bill rate forecasts.