Key economic indicators could be distorted by the COVID-19 pandemic, the IMF warns.
"Accurate and timely economic data are crucial for informing policy decisions, especially during a crisis. But the COVID-19 pandemic has disrupted the production of many key statistics. Without reliable data, policymakers cannot assess how badly the pandemic is hurting people and the economy, nor can they properly monitor the recovery," the MFA said in a blog.
A statement came when many countries were publishing GDP data for the first three months of this year. In the US, the largest economy in the world, the White House and Congress use GDP data to plan spending and tax policies. The Federal Reserve also takes into account GDP indicators when determining monetary policy, CNBC reported.
“Business people use these stats when making decisions about jobs, expansion, investments, and more,” the BEA said on its website.
The IMF noted that one of the most important barriers to obtaining reliable and timely economic statistics during the pandemic is the constraints that keep the staff of national statistical offices at home.
“For example, the calculation of retail prices often requires physical visits to stores but this is currently not possible in many countries,” the fund explained.
“Similarly, surveying businesses about their production and investment plans is difficult as many have temporarily shut down or simply do not have the resources to respond to statistical questionnaires,” it added.
According to the IMF, such failures can lead to the fact that data on prices and production, which are crucial for monetary policy and decisions on tax incentives, will be delayed or estimated based on partial information.
The fund said the ongoing pandemic also underscores the importance of frequently updated data that allows politicians to make “the best-informed decisions.”
Many traditional official statistics “are just not sufficiently up to date to be useful at this time,” it added.
The IMF said that there are ways to overcome these problems, including using alternative sources of information.
