How it’s done : The models and analysis behind the Bank of Finland’s forecasts for the Finnish economy

Abstract

The Bank of Finland produces forecasts for the Finnish economy using advanced modelling tools. Central to this process is its Aino model, which is a dynamic stochastic general equilibrium (DSGE) model that integrates various aspects of the Finnish economy. The forecasts support policy decisions within the Eurosystem and are updated regularly. This article describes the forecasting process, model features and their key role in economic analysis at the Bank of Finland.