Journal Article
A note on predicting recessions in the euro area using real M1
Real M1 is a renowned leading indicator used to forecast real economic activity. This note provides evidence that real M1 is also a suitable recession indicator that gave a clear and early signal for the Great Recession as long as changes in money demand are controlled for.
Key Words
- Euro area
- Euroraum
- narrow money
- Predicting recessions
- Probit
- real M1