The Quality of Economic Forecasts in Times of Extraordinary Crises

The unpredictable onset of the COVID-19 pandemic led to significant downward revisions of economic forecasts for 2020 worldwide. During the pandemic, the health policy measures announced at short notice hampered forecasting activities. The following recovery was interrupted by Russia's invasion of the Ukraine, which led to sharp price increases in the EU and the implementation of economic sanctions. At the turn of 2022-23, Austria entered its longest recession since the foundation of the Second Republic. During this period, signs of improvement appeared several times, which turned out to be short-lived. This paper examines the extent of revisions to forecasts for Austrian GDP by national (WIFO, IHS, OeNB) and international forecasting institutions (European Commission, OECD, and IMF) for the period from 2020 to 2024. For comparison purposes, it examines the accuracy of forecasts for German economic growth by domestic forecasting institutes and international organisations, as well as the accuracy of forecasts for real GDP in the euro area by international organisations.