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Britain's central bank has investigated for several years
whether it can glean anything about the economic outlook by
analyzing the ratio of positive words in news stories such as
'growth', to less upbeat terms such as 'recession'.
Its researchers found that analysis of The Guardian's coverage
of business, politics and economics gives a slightly better
steer than looking at share prices, although it was less useful
than monthly surveys of business and households.
"News travels fast, and it seems that real-time information
about the UK economy is no exception," Arthur Turrell, Nikoleta
Anesti and Silvia Miranda-Agrippino said about their work on a
BoE research website.
The Guardian, a left-leaning daily, was chosen for the research
because it was free and easy to download, and including more
media might improve results further, they added.
Monthly purchasing managers' indices and the long-running GfK
consumer sentiment index were the most useful indicators for
predicting British economic growth one to three months ahead,
followed by official industrial output data, they said.
But news articles can be analyzed at any point in the month,
potentially offering policymakers more timely information.
The BoE has previously said it would face the challenge of
having to quickly assess the state of Britain's economy
immediately after a no-deal Brexit due on March 29, though Prime
Minister Theresa May this week raised the prospect of a delay.
(Reporting by David Milliken; Editing by William Schomberg and
Alexander Smith)
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