{"id":4866,"date":"2018-11-28T14:31:51","date_gmt":"2018-11-28T14:31:51","guid":{"rendered":"http:\/\/www.styledeals.co.uk\/blog\/brexit-what-is-an-economic-forecast\/"},"modified":"2018-11-28T14:31:51","modified_gmt":"2018-11-28T14:31:51","slug":"brexit-what-is-an-economic-forecast","status":"publish","type":"post","link":"https:\/\/www.styledeals.co.uk\/blog\/brexit-what-is-an-economic-forecast\/","title":{"rendered":"Brexit: What is an economic forecast?"},"content":{"rendered":"\n<div property=\"articleBody\">\n<figure class=\"media-landscape no-caption full-width lead\"><span class=\"image-and-copyright-container\"><\/p>\n<p>                <img loading=\"lazy\" decoding=\"async\" class=\"js-image-replace\" alt=\"Stock market chart\" src=\"https:\/\/ichef.bbci.co.uk\/news\/320\/cpsprodpb\/ADA3\/production\/_104515444_gettyimages-849920718.jpg\" width=\"2121\" height=\"1414\"\/><span class=\"off-screen\">Image copyright<\/span><br \/>\n                 <span class=\"story-image-copyright\">Getty Images<\/span><\/p>\n<p>            <\/span><\/p>\n<\/figure>\n<p class=\"story-body__introduction\">The government has published its <a href=\"https:\/\/assets.publishing.service.gov.uk\/government\/uploads\/system\/uploads\/attachment_data\/file\/759762\/28_November_EU_Exit_-_Long-term_economic_analysis.pdf\" class=\"story-body__link-external\">official economic analysis of the impact of its Brexit deal<\/a>.<\/p>\n<p>It suggests the government&#8217;s version of Brexit could leave the size of the UK economy up to 3.9% smaller after 15 years, compared with staying in the EU.<\/p>\n<p>But a no-deal Brexit could deliver a 9.3% hit &#8211; according to the forecast.<\/p>\n<p>Separately, the Bank of England is due to publish its Brexit assessment at 1630 GMT.<\/p>\n<p>But what exactly do economists mean by &#8220;forecasts&#8221; and how accurate are they?<\/p>\n<h2 class=\"story-body__crosshead\">What is a forecast?<\/h2>\n<p>A forecast is not a guess. It is a calculation made by economists of the most likely thing that will happen in the future, given all the facts available.<\/p>\n<p>Historical experience, existing conditions, intended policy &#8211; the government approach to Brexit for example &#8211; and a variety of possible future events are fed into a computer model which then produces a range of different outcomes.<\/p>\n<p>The central forecast is the one that comes in the middle of the most extreme outcomes.<\/p>\n<ul class=\"story-body__unordered-list\">\n<li class=\"story-body__list-item\"><a href=\"https:\/\/www.bbc.co.uk\/news\/uk-politics-46366162\" class=\"story-body__link\">Philip Hammond: Brexit will leave UK economy worse off<\/a><\/li>\n<li class=\"story-body__list-item\"><a href=\"https:\/\/www.bbc.co.uk\/news\/uk-politics-46360310\" class=\"story-body__link\">Reality Check: Is Trump right about the Brexit deal?<\/a><\/li>\n<\/ul>\n<h2 class=\"story-body__crosshead\">Can they be wrong?<\/h2>\n<p>In one respect a forecast is a bit like rolling two dice. The most common number you are likely to throw is a seven &#8211; that would be the central forecast.<\/p>\n<p>Now, you could get two or you could get 12. That doesn&#8217;t mean that the forecast of seven was wrong, it was just that a more unlikely outcome happened.<\/p>\n<p>Forecasts contain what is called a &#8220;distribution&#8221; &#8211; that is an upper and lower figure to show a range of possibilities.<\/p>\n<h2 class=\"story-body__crosshead\">So, it&#8217;s random, like dice-throwing?<\/h2>\n<p>No, a forecast is more than a roll of the dice, which is random. It&#8217;s a calculation based on experience, facts, judgement and statistics.<\/p>\n<p>On trade, for example, there are plenty of statistics which show the economic effects of more open trade between countries or more barriers to trade.<\/p>\n<p>A forecast is an attempt to use past events to predict the future (not always with complete precision) and is seen as useful in showing a direction of travel &#8211; better for the economy or worse &#8211; given what we know historically.  <\/p>\n<figure class=\"media-landscape no-caption body-width\"><span class=\"image-and-copyright-container\"><\/p>\n<p>            <\/span><\/p>\n<\/figure>\n<figure class=\"media-landscape no-caption full-width\"><span class=\"image-and-copyright-container\"><\/p>\n<p>            <\/span><\/p>\n<\/figure>\n<p><a href=\"http:\/\/www.bbc.co.uk\/realitycheck\" class=\"story-body__link\">Read more from Reality Check<\/a><\/p>\n<p><a href=\"http:\/\/www.bbc.co.uk\/news\/uk-41928747\" class=\"story-body__link\">Send us your questions<\/a><\/p>\n<p><a href=\"https:\/\/twitter.com\/bbcrealitycheck\" class=\"story-body__link-external\">Follow us on Twitter<\/a><\/p>\n<\/p><\/div>\n<p><script async src=\"http:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><br \/>\n<br \/>\n<br \/><a href=\"https:\/\/www.bbc.co.uk\/news\/uk-46358120\">Source<\/a> by <a href=\"\">[author_name]<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Image copyright Getty Images The government has published its official economic analysis of the impact of its Brexit deal. It suggests the government&#8217;s version of Brexit could leave the size of the UK economy up to 3.9% smaller after 15 years, compared with staying in the EU. But a no-deal Brexit could deliver a 9.3% &hellip; <\/p>\n","protected":false},"author":0,"featured_media":4867,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-4866","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general"],"_links":{"self":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/4866","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=4866"}],"version-history":[{"count":0,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/posts\/4866\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media\/4867"}],"wp:attachment":[{"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=4866"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=4866"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.styledeals.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=4866"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}