Federal finance and statistics / Central Bank of Nigeria

Big Data and Inflation Forecasting in Nigeria: A Text Mining Application1

This study explores the usefulness of public sentiments obtained using machine learning methods to improve the predictive power of the existing short-term inflation forecasting model (STIF) in Nigeria. Findings indicate that, for all components of inflation, models that include the computed sentiment index perform better in both in-sample and out-sample forecasts than those excluding the index. Thus, we conclude that sentiment-based inflation forecasting models are useful for improving the | Keywords: Big data, Forecast, Inflation