Predicting UK Industrial Production: Stock Market, Interest Rates Key Indicators
The article looks at ways to predict UK industrial production, especially during the 1990s recession. Different models were tested, including linear and nonlinear ones. The nonlinear models didn't do well during the 1990s recession, possibly because it was different from previous recessions. However, a three-indicator linear model performed well, using short-term interest rates, stock market dividend yield, and a survey by the Confederation of British Industry.