We study the real-time signals provided by the Aruoba-Diebold-Scotti Index of Business conditions (ADS) for tracking economic activity at high frequency. We start with exit from the Great Recession, comparing the evolution of real-time vintage beliefs to a "final" late-vintage chronology. We then consider entry into the Pandemic Recession, again tracking the evolution of real-time vintage beliefs. ADS swings widely as its underlying economic indicators swing widely , but the emerging ADS path as of this writing (late June) indicates a return to growth in May. The trajectory of the nascent recovery, however, is highly uncertain -- particularly as COVID-19 spreads in the South and West -- and could be revised or eliminated as new data arrive .
Entering the Pandemic Recession, we study the high-frequency real-activity signals provided by a leading nowcast, the ADS Index of Business Conditions produced and released in real time by the Federal Reserve Bank of Philadelphia. We track the evolution of real-time vintage beliefs and compare them to a later-vintage chronology. Real-time ADS plunges and then swings as its underlying economic indicators swing , but the ADS paths quickly converge to indicate a return to brisk positive growth by mid-May. We show, moreover, that the daily real activity path was extremely highly correlated with the daily COVID-19 path. Finally, we provide a comparative assessment of the real-time ADS signals provided when exiting the Great Recession .
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We study the real-time
Entering the Pandemic Recession, we study the high-frequency real-activity
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the Aruoba-Diebold-Scotti
a leading nowcast, the ADS
R
conditions (ADS) for tracking economic activity at high frequency. We start with exit from the Great Recession, comparing the
Conditions produced and released in real time by the Federal Reserve Bank of Philadelphia. We track the
R
to a "final" late-vintage chronology. We then consider entry into the Pandemic Recession, again tracking the evolution of real-time vintage beliefs. ADS swings widely
and compare them to a later-vintage chronology. Real-time ADS plunges and then swings
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widely
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emerging ADS path as of this writing (late June) indicates
ADS paths quickly converge to indicate
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growth in May. The trajectory of the nascent recovery, however, is highly uncertain -- particularly as
brisk positive growth by mid-May. We show, moreover, that the daily real activity path was extremely highly correlated with the daily
R
spreads in the South and West -- and could be revised or eliminated as new data arrive
path. Finally, we provide a comparative assessment of the real-time ADS signals provided when exiting the Great Recession