Edition: February 2026 Next update: 25 March 2026

Economic developments

GDP increased

Source: Eurostat (namq_10_GDP) and OECD.

Source: Eurostat (namq_10_GDP) and OECD.

Development of GDP

Situation in the euro area and the EU

In the fourth quarter of 2025, seasonally adjusted GDP increased, up 0.3% quarter on quarter in both the euro area and the EU. For comparison, an increase of 0.3% had also been observed in the third quarter of 2025 in the euro area and 0.4% in the EU.

Situation in the EU countries

Based on the latest quarter-on-quarter rates of change, GDP increased in the fourth quarter of 2025 in 18 countries, was unchanged in 1 and decreased in 2 (fourth quarter data are not available for 6 countries at the time of writing). Lithuania (up 1.7%) recorded the largest increase of GDP, while the decreases were observed in Romania (down 1.9%) and Ireland (down 0.6%).

Situation in non-EU countries

Compared with the previous quarter, GDP expanded in the fourth quarter of 2025 in China (up 1.2%), Japan and Switzerland (both up 0.1%). In the third quarter of 2025, GDP expanded in Norway and the United States (both up 1.1%), while it contracted in Iceland (down 0.2%).

(*) See latest estimates for more data.

Industrial production decreased

Source: Eurostat (sts_inpr_m).

Source: Eurostat (sts_inpr_m).

Industrial production

In December 2025, seasonally adjusted industrial production decreased month on month by 1.3% in the euro area and by 0.8% in the EU. In the previous month, there had been an increase of 0.3% in the euro area and a marginal decrease (down 0.1%) in the EU.

Production in construction decreased

Source: Eurostat (sts_copr_m)

Source: Eurostat (sts_copr_m)

Production in construction

In November 2025, seasonally adjusted production in construction decreased 1.1% in both the euro area and the EU compared with the previous month. In the previous month, it had increased 1.7% in the euro area and 1.4% in the EU.

Retail trade sales decreased

Source: Eurostat (sts_trtu_m).

Source: Eurostat (sts_trtu_m).

Retail trade

In December 2025, the seasonally adjusted volume of sales in retail trade decreased compared with the previous month in the euro area and the EU (both down 0.5%), following on from slight increases in the previous month in the euro area (up 0.1%) and the EU (up 0.2%).

Annual inflation decreased

Source: Eurostat (prc_hicp_manr) and OECD.

Source: Eurostat (prc_hicp_manr) and OECD.

Inflation

Situation in the euro area and the EU

According to the latest data from Eurostat, the annual inflation rate (based on the HICP) in the euro area was 1.7% in January 2026, down 0.3 percentage points from the previous month. In the EU, the annual inflation rate was 2.3% in December 2025, down 0.1 percentage points from the previous month.

Situation in the EU countries

The highest annual inflation rates (based on the HICP) in January 2026 were recorded in Slovakia (4.2%) and Croatia (3.6%) and the lowest rate was recorded in France (0.4%); January data are not available for 7 countries at the time of writing.

Situation in non-EU countries

In January 2026, the annual inflation rate was 2.4% in the United States and 0.2% in China. In December 2025, the annual inflation rate was 4.0% in Iceland, 3.0% in Norway, 2.1% in Japan and 0.2% in Switzerland.

Total unemployment rate was unchanged

Source: Eurostat (une_rt_m) and OECD.

Source: Eurostat (une_rt_m) and OECD

Total unemployment

Situation in the euro area and the EU

In December 2025, the seasonally adjusted unemployment rate was 6.2% in the euro area, unchanged from the previous month. In the EU, the rate was 5.9%, also unchanged from the previous month.

Situation in the EU countries

In December 2025, the lowest unemployment rates were recorded in Czechia (3.1%), Poland, Malta (both 3.2%) and Bulgaria (3.3%). The highest rates were in Finland (10.3%), Spain (10.0%), Sweden (8.8%), France (7.7%) and Greece (7.5%).

Situation in non-EU countries

The unemployment rate in December 2025 was 4.4% in the United States, 4.3% in Norway and 2.6% in Japan. The unemployment rate was 4.6% in Iceland in November 2025 and 5.0% in Switzerland in September 2025.

Youth unemployment rate decreased

Source: Eurostat (une_rt_m) and OECD.

Source: Eurostat (une_rt_m) and OECD.

Youth unemployment

In December 2025, the youth unemployment rate (for people aged 15 to 24 years) was 14.3% in the euro area, down from 14.4% in the previous month. In the EU, the rate was 14.7%, down from 14.9% in the previous month.

Economic sentiment strengthened

Source: Eurostat/DG ECFIN (ei_bssi_m_r2).

Source: Eurostat/DG ECFIN (ei_bssi_m_r2).

Economic sentiment indicator

Situation in the euro area and the EU

In January 2026, the economic sentiment indicator increased, up 2.2 percentage points in the euro area and 1.9 percentage points in the EU: the index level was 99.4 percentage points in the euro area and 99.2 percentage points in the EU. The increase in the euro area resulted from increases in confidence among consumers as well as industrial, retail trade and services managers and no change in confidence among construction managers.

Situation in the EU countries

In January 2026, the economic sentiment indicator showed slightly more positive than negative developments among the EU countries, increasing in 14, unchanged in 1 and decreasing in 12. The strongest increase was in France (up 5.8 percentage points), followed by Germany (up 3.0 percentage points) and Poland (up 2.9 percentage points). The strongest decreases were in Hungary (down 4.9 percentage points) and Luxembourg (down 4.1 percentage points). Apart from these 5 countries, the latest month-on-month changes ranged between 2.7 and -3.4 percentage points. The index level of the economic sentiment indicator (with a long-term average = 100) generally varied from 91.5 percentage points in Luxembourg to 106.3 percentage points in Croatia, with the index in Malta (122.3 percentage points) well above this range.

Employment expectations increased

Source: Eurostat/DG ECFIN (ei_bsee_m_r2).

Source: Eurostat/DG ECFIN (ei_bsee_m_r2).

Employment expectations indicator

In January 2026, the employment expectations indicator increased (up 1.2 percentage points compared with the previous month) to 98.2 in the euro area; expectations were up 0.9 percentage points in the EU to 99.1. The increase in the euro area in January 2026 was due to less optimistic employment plans among construction managers being outweighed by less pessimistic plans among industrial and retail trade managers and more optimistic plans among services managers.

Growth assessment

The €-coin indicator decreased

Source: Bank of Italy/CEPR and Eurostat (namq_10_GDP).

€-coin

The €-coin decreased to 0.49 in january 2026, down from 0.52 in the previous month. The performance of the indicator reflects a softening of positive signals in the service sector, as reported by qualitative surveys (according to the latest release of the National Bank of Italy on 3 February 2026).

The business climate indicator increased

Source: Eurostat/DG ECFIN (ei_bsci_m_r2).

Business climate indicator

The business climate indicator for the euro area increased to -0.39 points in January 2026 (up from -0.47 points in the previous month).

The coincident indicators signal a phase of expansion with accelerating growth

Source: Eurostat (own calculations).

Source: Eurostat (own calculations).

Coincident indicators

The growth cycle coincident indicator (GCCI) was 0.06 in January 2026, the business cycle coincident indicator (BCCI) was 0.00 and the acceleration cycle coincident indicator (ACCI) was 0.24, indicating a phase of expansion with accelerating growth for the euro area.

The GCCI, BCCI and ACCI are synthetic indicators which are experimental in nature and calculated for Eurostat’s business cycle clock. The GCCI shows the probability of a slowdown in the economy and signals the peaks and troughs of the growth cycle, the BCCI shows the probability of a recession and signals the peaks and troughs of the business cycle and the ACCI shows the probability of a deceleration in the growth rate and signals the peaks and troughs of the growth rate cycle. The probability is given on a scale from 0 to 1.

Read more about the methodology in the Statistics Explained article about the business cycle clock.

DZ BANK’s Euro-Indikator increased

Source: DZ Bank Research

DZ BANK’s Euro-Indikator

The DZ BANK’s Euro-Indikator increased 0.48% month on month to 98.48 points in January 2026, following on from a smaller increase (up 0.20%) in the previous month. When compared with the same month in the previous year, the Euro-Indikator was 1.59% higher in January 2026.

Latest forecasts indicated continued growth despite a challenging environment

Forecasts for the euro area’s GDP growth and inflation for 2025, 2026 and 2027
(%)
Forecast
GDP growth
Inflation
2026 2027 2026 2027
European Commission – Spring 2025 1.4 : 1.7 :
Economic forecasts Autumn 2025 1.2 1.4 1.9 2.0
ECB – September 2025 1.0 1.3 1.7 1.9
Macroeconomic Projections December 2025 1.2 1.4 1.9 1.8
IMF – October 2025 1.1 1.4 1.9 2.1
World Economic Outlook January 2026 1.3 1.4 1.9 2.0
OECD – September 2025 1.0 : 1.9 :
Economic Outlook Forecasts December 2025 1.2 1.4 1.9 2.0
Sources: EC Economic Forecast: Spring 2025, Autumn 2025, ECB Macroeconomic Projections: September 2025, December 2025, IMF World Economic Outlook: October 2025, January 2026, OECD Economic Outlook: September 2025, December 2025,
Forecasts for the euro area member countries’ GDP growth for 2026
(%)
European Commission
ECB
IMF
OECD
Spring 2025 Autumn 2025 September 2025 December 2025 October 2025 January 2026 September 2025 December 2025
Euro area 1.4 1.2 1.0 1.2 1.1 1.3 1.0 1.2
Belgium 0.9 1.1 : 1.0 1.0 : : 1.1
Bulgaria 2.1 2.7 : 3.1 : : : 2.6
Germany 1.1 1.2 : 0.6 0.9 1.1 1.1 1.0
Estonia 2.3 2.1 : 3.6 1.5 : : 2.9
Ireland 2.5 0.2 : 3.1 1.3 : : 2.1
Greece 2.2 2.2 : 2.1 2.0 : : 2.2
Spain 2.0 2.3 : 2.2 2.0 2.3 2.0 2.2
France 1.3 0.9 : 1.0 0.9 1.0 0.9 1.0
Croatia 2.9 2.9 : 2.8 2.7 : : 2.7
Italy 0.9 0.8 : 0.6 0.8 0.7 0.6 0.6
Cyprus 2.5 2.6 : 3.0 2.8 : : :
Latvia 2.0 1.7 : 2.8 2.2 : : 2.1
Lithuania 3.1 3.0 : 3.2 2.9 : : 3.1
Luxembourg 2.0 1.9 : 1.9 2.1 : : 1.9
Malta 4.0 3.8 : 3.7 3.9 : : :
Netherlands 1.2 1.3 : 1.2 1.2 1.2 : 1.4
Austria 1.0 0.9 : 0.8 0.8 : : 0.9
Portugal 2.2 2.2 : 2.3 2.1 : : 2.2
Slovenia 2.4 2.4 : 2.2 2.3 : : 2.3
Slovakia 1.4 1.0 : 0.6 1.7 : : 1.1
Finland 1.3 0.9 : 0.8 1.3 : : 0.9
Sources: See first table
Forecasts for the euro area member countries’ inflation for 2026
(%)
European Commission
ECB
IMF
OECD
Spring 2025 Autumn 2025 September 2025 December 2025 October 2025 January 2026 September 2025 December 2025
Euro area 1.7 1.9 1.7 1.9 1.9 1.9 1.9 1.9
Belgium 1.8 1.8 : 2.2 1.3 : : 1.6
Bulgaria 1.8 2.9 : 3.5 : : : :
Germany 1.9 2.2 : 2.2 1.8 : 2.1 2.1
Estonia 2.3 2.8 : 3.2 4.3 : : 3.5
Ireland 1.4 1.9 : 2.3 1.7 : : 2.2
Greece 2.3 2.3 : 2.1 2.5 : : 2.2
Spain 1.9 2.0 : 2.1 2.0 : 2.0 2.3
France 1.2 1.3 : 1.3 1.5 : 1.6 1.3
Croatia 2.0 2.8 : 3.4 2.8 : : 3.3
Italy 1.5 1.3 : 1.4 2.0 : 1.8 1.7
Cyprus 2.0 1.5 : 1.7 1.3 : : :
Latvia 1.7 2.2 : 3.2 2.6 : : 2.5
Lithuania 1.2 2.8 : 3.1 3.1 : : 3.0
Luxembourg 1.8 1.7 : 1.3 2.2 : : 2.1
Malta 2.1 2.1 : 2.3 2.0 : : :
Netherlands 2.0 2.5 : 2.4 2.4 : : 2.2
Austria 2.1 2.4 : 2.4 2.3 : : 2.6
Portugal 2.0 2.0 : 2.1 2.1 : : 2.2
Slovenia 1.9 2.3 : 2.3 2.4 : : 2.4
Slovakia 2.9 4.1 : 3.4 3.3 : : 3.7
Finland 1.5 1.6 : 1.4 1.9 : : 1.8
Sources: See first table
Forecasts for the euro area’s GDP growth and inflation for 2025, 2026 and 2027
(%)
Forecast
GDP growth
Inflation
2026 2027 2026 2027
European Commission – Spring 2025 1.4 : 1.7 :
Economic forecasts Autumn 2025 1.2 1.4 1.9 2.0
ECB – September 2025 1.0 1.3 1.7 1.9
Macroeconomic Projections December 2025 1.2 1.4 1.9 1.8
IMF – October 2025 1.1 1.4 1.9 2.1
World Economic Outlook January 2026 1.3 1.4 1.9 2.0
OECD – September 2025 1.0 : 1.9 :
Economic Outlook Forecasts December 2025 1.2 1.4 1.9 2.0
Sources: EC Economic Forecast: Spring 2025, Autumn 2025, ECB Macroeconomic Projections: September 2025, December 2025, IMF World Economic Outlook: October 2025, January 2026, OECD Economic Outlook: September 2025, December 2025,
Forecasts for the euro area member countries’ GDP growth for 2026
(%)
European Commission
ECB
IMF
OECD
Spring 2025 Autumn 2025 September 2025 December 2025 October 2025 January 2026 September 2025 December 2025
Euro area 1.4 1.2 1.0 1.2 1.1 1.3 1.0 1.2
Belgium 0.9 1.1 : 1.0 1.0 : : 1.1
Bulgaria 2.1 2.7 : 3.1 : : : 2.6
Germany 1.1 1.2 : 0.6 0.9 1.1 1.1 1.0
Estonia 2.3 2.1 : 3.6 1.5 : : 2.9
Ireland 2.5 0.2 : 3.1 1.3 : : 2.1
Greece 2.2 2.2 : 2.1 2.0 : : 2.2
Spain 2.0 2.3 : 2.2 2.0 2.3 2.0 2.2
France 1.3 0.9 : 1.0 0.9 1.0 0.9 1.0
Croatia 2.9 2.9 : 2.8 2.7 : : 2.7
Italy 0.9 0.8 : 0.6 0.8 0.7 0.6 0.6
Cyprus 2.5 2.6 : 3.0 2.8 : : :
Latvia 2.0 1.7 : 2.8 2.2 : : 2.1
Lithuania 3.1 3.0 : 3.2 2.9 : : 3.1
Luxembourg 2.0 1.9 : 1.9 2.1 : : 1.9
Malta 4.0 3.8 : 3.7 3.9 : : :
Netherlands 1.2 1.3 : 1.2 1.2 1.2 : 1.4
Austria 1.0 0.9 : 0.8 0.8 : : 0.9
Portugal 2.2 2.2 : 2.3 2.1 : : 2.2
Slovenia 2.4 2.4 : 2.2 2.3 : : 2.3
Slovakia 1.4 1.0 : 0.6 1.7 : : 1.1
Finland 1.3 0.9 : 0.8 1.3 : : 0.9
Sources: See first table
Forecasts for the euro area member countries’ inflation for 2026
(%)
European Commission
ECB
IMF
OECD
Spring 2025 Autumn 2025 September 2025 December 2025 October 2025 January 2026 September 2025 December 2025
Euro area 1.7 1.9 1.7 1.9 1.9 1.9 1.9 1.9
Belgium 1.8 1.8 : 2.2 1.3 : : 1.6
Bulgaria 1.8 2.9 : 3.5 : : : :
Germany 1.9 2.2 : 2.2 1.8 : 2.1 2.1
Estonia 2.3 2.8 : 3.2 4.3 : : 3.5
Ireland 1.4 1.9 : 2.3 1.7 : : 2.2
Greece 2.3 2.3 : 2.1 2.5 : : 2.2
Spain 1.9 2.0 : 2.1 2.0 : 2.0 2.3
France 1.2 1.3 : 1.3 1.5 : 1.6 1.3
Croatia 2.0 2.8 : 3.4 2.8 : : 3.3
Italy 1.5 1.3 : 1.4 2.0 : 1.8 1.7
Cyprus 2.0 1.5 : 1.7 1.3 : : :
Latvia 1.7 2.2 : 3.2 2.6 : : 2.5
Lithuania 1.2 2.8 : 3.1 3.1 : : 3.0
Luxembourg 1.8 1.7 : 1.3 2.2 : : 2.1
Malta 2.1 2.1 : 2.3 2.0 : : :
Netherlands 2.0 2.5 : 2.4 2.4 : : 2.2
Austria 2.1 2.4 : 2.4 2.3 : : 2.6
Portugal 2.0 2.0 : 2.1 2.1 : : 2.2
Slovenia 1.9 2.3 : 2.3 2.4 : : 2.4
Slovakia 2.9 4.1 : 3.4 3.3 : : 3.7
Finland 1.5 1.6 : 1.4 1.9 : : 1.8
Sources: See first table

Latest macroeconomic forecasts

European Commission: in its autumn 2025 report, the European Commission revised downwards its forecast for euro area growth for 2026 to 1.2% (from 1.4%) and introduced a forecast of 1.4% for 2027. It raised its forecasted euro area annual inflation rate for 2026 to 1.9% (from 1.7%) and introduced a forecast of 2.0% for 2027. A modest but steady expansion of domestic demand is expected to drive economic growth. EU growth is estimated to catch up with potential in 2025 and slightly outpace it in 2026–27. Services and food price pressures are set to weaken gradually over the forecast horizon.

ECB: the latest ECB Macroeconomic Projections for the euro area were published in December 2025. The ECB revised upwards its forecasted euro area growth for 2026 to 1.2% (from 1.0%) and its forecast for 2027 to 1.4% (from 1.3%). The ECB raised its its forecasted euro area annual inflation rate for 2026 to 1.9% (from 1.7%) and lowered its forecast for 2027 to 1.8% (from 1.9%). Growth is set to be supported by real disposable income growth, receding uncertainty, robust foreign demand, and fiscal stimulus related to defence and infrastructure spending.

IMF: in the World Economic Outlook Update of January 2026, euro area GDP was projected to expand by 1.3% in 2026, marking an upward revision of 0.2 percentage points compared with the previous forecast from October 2025. The IMF maintained its forecasted euro area annual inflation rate for 2026 at 1.9% and lowered its forecast for 2027 to 2.0% (from 2.1%). The subdued growth rate reflects unresolved structural headwinds. Lingering effects of the persistent rise in energy prices after Russia’s invasion of Ukraine will continue to drag on manufacturing, with additional pressure from the real appreciation of the euro relative to currencies of countries exporting similar products.

OECD (*): in the December 2025 report of the Economic Outlook, the OECD revised upwards its euro area growth forecast for 2026 to 1.2% (from 1.0% in its previous forecast); it introduced a forecast of 1.4% for 2027. The OECD maintained its forecasted euro area annual inflation rate for 2026 at 1.9%, and introduced a forecast of 2.0% for 2027. Growth is expected to pick up gradually as domestic demand strengthens and trade rebounds. Wage growth is projected to ease gradually, helping inflation to remain broadly on target.

(*) The euro area aggregate includes only OECD member countries. Bulgaria, Croatia, Cyprus and Malta are excluded as they are not members of the OECD.

Trend-cycle estimates

GDP in the euro area

Source: Eurostat (own calculations). Note that the primary y-axis is cut.

Trend-cycle estimates

This graph shows the quarterly GDP in current prices for the euro area, together with trend-cycle decompositions.

A trend-cycle decomposition method aims at further decomposing seasonally adjusted data into a trend component and a cyclical component (expressed as the deviation from the trend).

The trend provides information on longer-term movements in the seasonally adjusted series over several years; the cycle is a sequence of smoother fluctuations around the longer-term trend, in part characterised by alternating periods of expansion and contraction.

You can choose to show the estimates using three different filters.

  • Hodrick-Prescott (HP): a filter widely used in macroeconomics to fit a smooth curve through a set of points.
  • Christiano-Fitzgerald (CF): a well-known approximation to an ideal band pass filter, estimated non-parametrically.
  • The Harvey and Trimbur decomposition, which is probably the most well-known model within the Unobserved Components (UC) framework.

Read more in the methodological note.

Industrial production in the euro area

Source: Eurostat (own calculations). Note that the primary y-axis is cut.

Trend-cycle estimates

This graph shows the monthly industrial production index for the euro area, together with trend-cycle decompositions.

A trend-cycle decomposition method aims at further decomposing seasonally adjusted data into a trend component and a cyclical component (expressed as the deviation from the trend).

The trend provides information on longer-term movements in the seasonally adjusted series over several years; the cycle is a sequence of smoother fluctuations around the longer-term trend, in part characterised by alternating periods of expansion and contraction.

You can choose to show the estimates using three different filters.

  • Hodrick-Prescott (HP): a filter widely used in macroeconomics to fit a smooth curve through a set of points.
  • Christiano-Fitzgerald (CF): a well-known approximation to an ideal band pass filter, estimated non-parametrically.
  • The Harvey and Trimbur decomposition, which is probably the most well-known model within the Unobserved Components (UC) framework.

Read more in the methodological note.

Employment in the euro area

Source: Eurostat (own calculations). Note that the primary y-axis is cut.

Trend-cycle estimates

This graph shows the quarterly employment in thousand people for the euro area, together with trend-cycle decompositions.

A trend-cycle decomposition method aims at further decomposing seasonally adjusted data into a trend component and a cyclical component (expressed as the deviation from the trend).

The trend provides information on longer-term movements in the seasonally adjusted series over several years; the cycle is a sequence of smoother fluctuations around the longer-term trend, in part characterised by alternating periods of expansion and contraction.

You can choose to show the estimates using three different filters.

  • Hodrick-Prescott (HP): a filter widely used in macroeconomics to fit a smooth curve through a set of points.
  • Christiano-Fitzgerald (CF): a well-known approximation to an ideal band pass filter, estimated non-parametrically.
  • The Harvey and Trimbur decomposition, which is probably the most well-known model within the Unobserved Components (UC) framework.

Read more in the methodological note.

GDP in the EU

Source: Eurostat (own calculations). Note that the primary y-axis is cut.

Trend-cycle estimates

This graph shows the quarterly GDP in current prices for the EU, together with trend-cycle decompositions.

A trend-cycle decomposition method aims at further decomposing seasonally adjusted data into a trend component and a cyclical component (expressed as the deviation from the trend).

The trend provides information on longer-term movements in the seasonally adjusted series over several years; the cycle is a sequence of smoother fluctuations around the longer-term trend, in part characterised by alternating periods of expansion and contraction.

You can choose to show the estimates using three different filters.

  • Hodrick-Prescott (HP): a filter widely used in macroeconomics to fit a smooth curve through a set of points.
  • Christiano-Fitzgerald (CF): a well-known approximation to an ideal band pass filter, estimated non-parametrically.
  • The Harvey and Trimbur decomposition, which is probably the most well-known model within the Unobserved Components (UC) framework.

Read more in the methodological note.

Industrial production in the EU

Source: Eurostat (own calculations). Note that the primary y-axis is cut.

Trend-cycle estimates

This graph shows the monthly industrial production index for the EU, together with trend-cycle decompositions.

A trend-cycle decomposition method aims at further decomposing seasonally adjusted data into a trend component and a cyclical component (expressed as the deviation from the trend).

The trend provides information on longer-term movements in the seasonally adjusted series over several years; the cycle is a sequence of smoother fluctuations around the longer-term trend, in part characterised by alternating periods of expansion and contraction.

You can choose to show the estimates using three different filters:

  • Hodrick-Prescott (HP): a filter widely used in macroeconomics to fit a smooth curve through a set of points.
  • Christiano-Fitzgerald (CF): a well-known approximation to an ideal band pass filter, estimated non-parametrically.
  • The Harvey and Trimbur decomposition, which is probably the most well-known model within the Unobserved Components (UC) framework.

Read more in the methodological note.

Employment in the EU

Source: Eurostat (own calculations). Note that the primary y-axis is cut.

Trend-cycle estimates

This graph shows the quarterly employment in thousand people for the EU, together with trend-cycle decompositions.

A trend-cycle decomposition method aims at further decomposing seasonally adjusted data into a trend component and a cyclical component (expressed as the deviation from the trend).

The trend provides information on longer-term movements in the seasonally adjusted series over several years; the cycle is a sequence of smoother fluctuations around the longer-term trend, in part characterised by alternating periods of expansion and contraction.

You can choose to show the estimates using three different filters.

  • Hodrick-Prescott (HP): a filter widely used in macroeconomics to fit a smooth curve through a set of points.
  • Christiano-Fitzgerald (CF): a well-known approximation to an ideal band pass filter, estimated non-parametrically.
  • The Harvey and Trimbur decomposition, which is probably the most well-known model within the Unobserved Components (UC) framework.

Read more in the methodological note.