Implication of Changing Monetary Policy on National and Industry Forecasts

Abstract

It seems likely that business forecasters need to have actess to simple simulation models to help analyze changing national economic conditions. A model such as FORESAL provides the forecaster with such a tool for use on his PC. The user can estimate the impact that changing monetary policy may have for their industry or firm forecasts by determining the change in one policy or economic variable while leaving all other variables constant. The business forecaster can then trace through the change in that policy variable to determine the implication to the industry in question. Without such a tool the forecaster is left to the mercies of changed national economic conditions and forecasts without being able to adjust their industry forecasts for these national policy changes.