New Text Analysis Method Outperforms Yield Curve in Predicting Recessions
A new method using text analysis can predict U.S. recessions better than the traditional yield curve method. By analyzing text data alongside economic indicators, the new approach improves recession forecasts by up to 30% at certain time horizons. This method also provides additional insights not captured by yield curve data alone, making it a valuable tool for understanding and predicting economic downturns.