In this paper we present a multivariate analysis of the Federal Reserve’s forecasts. First, we use existing univariate methods to evaluate each of the Fed’s forecasts of the ten major expenditure categories of real GDP which have not previously been evaluated in the literature. Second, we...

Recent research has shown that unobserved components (UC) models can, under certain conditions, be estimated without imposing the common zero-correlation restriction between the permanent and transitory innovations. Estimates applying this model to US real GDP suggest that US output experiences...