Individuals participating in forecaster surveys typically make mistakes. However, central bank survey makers assume these mistakes fall away relative to other participants over time. That is, no professional forecaster is systematically better or worse at predicting the future than other participants. But a new Federal Reserve Bank of Cleveland working paper shows that this is untrue for the European Central Bank’s (ECB) Survey of Professional Forecasters (SFP).

Specifically, the authors find that particular forecasters are consistently better at forecasting during more volatile economic periods, while others display higher relative accuracy in more tranquil environments. There is also evidence that certain participants outperform in all economic conditions and so could have higher innate ability – though this is not the paper’s main focus. The paper also shows how average forecaster performance varies over time.