In a comment for Sovereign Economy telegram channel, Evgeny Goryunov, Head of the Gaidar Institute's Monetary Policy Department assessed the US regulator's plans to update its approaches to collecting and analyzing economic statistics.
According to the expert, the Central Bank of Russia should also more actively use new sources of information, but revolutionary changes in statistical quality are not to be expected. The Russian regulator has long since moved beyond Rosstat data: it uses bank reports, information on foreign trade transactions and the results of its own surveys of businesses and households. Therefore, the main limitations of monetary policy are not related to a lack of data, but to the objective difficulty in forecasting economic processes.
Evgeny Goryunov noted that additional sources of information can make the analysis more comprehensive, but their importance should not be overestimated. In particular, studies based on the fiscal receipt database showed only minor discrepancies with official inflation estimates.
According to the expert, as e-commerce grows, central banks should pay more attention to marketplace prices. However, a higher frequency of information updates does not necessarily mean it will be more useful for decision-making.
“There's climate, and there's weather. Weather is constantly changing, while climate reflects long-term processes. For a central bank, it's much more important to see these stable trends than to react to daily price fluctuations. Therefore, new sources of information, including marketplace data, are certainly worth utilizing. But we shouldn't expect them to revolutionize statistics or fundamentally improve the quality of decision-making," Evgeny Goryunov noted.
Evgeny Goryunov estimates that the use of high-frequency data does not pose significant risks. As the Central Bank of Russia is well aware of volatility of such data and is able to distinguish short-term fluctuations from long-term economic trends, it will never base monetary policy decisions solely on daily changes in these indicators.