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Good practice Imported

Nowcasting Chilean Household Consumption With Electronic Payment Data — Banco Central de Chile's Pandemic-Era Model

Chile · Santiago · See the Chile profile · See the Santiago profile

Evidence: Observational / pre–post Top 62% 53/100 · Ask Evidence Copilot about this practice

Banco Central de Chile tested near-zero-lag electronic card-payment data against its standard nowcasting methods for tracking household consumption through the COVID-19 shock, finding accuracy gains once spending categories were properly weighted.

Details

Maturity
Pilot
Promoter
Banco Central de Chile
Period
2020-2023
Keywords
central banking, household consumption, real-time data, electronic payments, nowcasting

Context

When the COVID-19 shock hit, Chile's official household consumption statistics were too slow to show policymakers real-time spending shifts, while electronic card-payment data has virtually no lag.

Activities

In Working Paper No. 931, Banco Central de Chile economist Marcus P. A. Cobb tested nowcasting models built from electronic payment data against the bank's standard nowcasting methods through the pandemic period.

Results

Payment data captured real-time swings in spending during the shock, and simple models relying solely on payment data could produce further nowcasting-accuracy gains once sectors were assigned appropriate representativity weighting.

Conclusions

This is a research working paper testing a novel real-time data source, not a confirmed component of the bank's standing operational nowcasting system; its documented value is greatest during acute shocks.

Implementation
Indicative cost
Low (< €50k)
Time to results
Short (< 1 year)

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Data sources

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