Timely statistical information for monetary policy purposes Werner Bier Deputy Director-General Statistics, European Central Bank International Seminar on Timeliness, Methodology and Comparability of Rapid Estimates of Economic Trends Ottawa, 27-29 May 2009

Content Monetary policy data needs - the example of the European Central Bank Timeliness of data for the euro area Assessing a wide range of data in a short period of time – consistency and accessibility of data The challenges for statistics of a global economy

The ECB’s monetary policy framework Primary objective: price stability Monetary policy decisions based on a unified overall assessment of the risks to price stability Economic analysis Monetary analysis Analysis of economic dynamics and shocks Cross- checking Analysis of monetary trends Full set of information (monetary, financial and economic statistics, euro area accounts, macro-economic projections, opinion surveys, market data, ...)

Timeline of euro area statistical data

Timeliness of data for the euro area Forecasts (‘broad’ and ‘narrow’ projection exercises) Opinion surveys (e.g. bank lending survey, business and consumer surveys, purchasing managers surveys): at least monthly with a high timeliness Market data (e.g. stock market data, exchange rates, yields): at least daily, frequently “tick-by-tick” Monetary and financial statistics (e.g. MFI (bank) balance sheets & interest rates, securities, balance of payments): monthly Short-term statistics (e.g. Harmonised CPI (HICP), unemployment rate, leading indicators): monthly National accounts (e.g. GDP, sector accounts): quarterly with a timeliness between 45 - 90 days

Coherence among the information sets - I Assessing huge data sets in a very timely fashion Coherence in the concepts applied between e.g. - forecasts and national accounts (SNA 2008) - national accounts by sector including (financial) balance sheets and monetary & financial statistics, balance of payments statistics & international investment positions (BPM6) - national accounts and short-term statistics - short-term statistics and opinion surveys - micro market data (e.g. individual securities) and financial statistics

Coherence among the information sets - II Coherence among different data sets also requires - acceptance of main statistical standards such as SNA 2008 / BPM6 or the statistical classification of economic activities - close cooperation among data providers on the detailed methodology applied, the compilation timetable, revision policies, underlying registers, the seasonal adjustment, etc. - exchange of (confidential) data, where needed - organisational measures (partly including legal provisions) involving also senior management

Accessibility of data Assessing huge data sets in a very timely fashion Application of Statistical Data Warehouses that - provide access to different data sets simultaneously (e.g. market data, opinion surveys, national accounts and related forecasts) - allow dedicated access rights, where needed Networks of Statistical Data Warehouses among producers and users of data Statistical Data and Metadata eXchange (SDMX)

The challenges for statistics of a global economy Globalisation requires global statistics: - agreed international statistical standards such as the SNA 2008 and the BPM6 - comparable statistics at least among systemic relevant countries - relevant timely world-aggregates such as a quarterly global GDP at day t+60 - a central and publicly accessible database for the Principal Global Economic Indicators (PGEIs) - Inter-Agency Group on Economic and Financial Statistics (Principal Global Indicators Website)

A few conclusions Monetary policy decisions are evidence based and forward looking, and rely on a wide range of data The relevance of statistics is enhanced by a higher degree of coherence, timeliness and reliability In the short-term, there is a trade-off between coherence, timeliness and reliability In the medium-term, one cannot only move on the production function for statistics, but one can move the production function Globalisation requires global statistics with appropriate regional breakdowns