Massey University’s Knowledge Exchange Hub has launched a new tool aimed at providing a real time measure of GDP. This follows frustration with how out of date official statistics are
The tracker harnesses data from a wide range of sources including KiwiRail, the New Zealand Transport Agency, Port of Tauranga and other ports, Paymark, Statistics New Zealand and the Reserve Bank. It uses artificial intelligence and machine learning to produce an up-to-the-minute measure of activity.
Knowledge Exchange Hub director Christoph Schumacher, who is also an innovation and economic professor at the university, says official GDP statistcs are always out of date.
For example, this Thursday Statistics New Zealand will publish the September quarter data and the December quarter figures won’t be out until late March.
“They tell us what GDP was three months ago. That is a bit frustrating and is what motivated us to do this,” Schumacher says.
He says he got the idea for the GDP tracker about three years ago and the university has been trialling algorithms for the last 18 months to get to this stage.
As time goes by, the tracker should become better at calculating the current rate of economic growth and at forecasting future growth, he says.
If the predicted rates of growth get within a few points of the official data, that will show the tracker is doing the hoped-for job. “The hope is, of course, that we’re getting very close.”
Still, even the official GDP numbers are frequently revised: Statistics New Zealand is expected to release its annual revisions on Thursday.
The GDP tracker is forecasting Thursday’s data will show the economy grew 0.648 percent in the September quarter and 2.919 percent in the year ended September.
That’s just a touch higher than most economists are forecasting; ANZ, ASB and Westpac economists are all forecasting a 0.5 percent quarterly increase.
The tracker is also forecasting that December quarter growth will be about 0.66 percent and that will pick up to 0.754 percent in the March quarter next year.
The tracker also provides a breakdown of growth in different sectors from manufacturing and construction to wholesale trade and healthcare.
Still under development are measures of agriculture, forestry and fishing and mining.