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Bank of England to monitor Internet, collect unconventional economic data

Bank of England to monitor Internet, collect unconventional economic data

LONDON: The UK central bank has set up a task force to monitor the internet and social networks with a view to collecting unconventional data that would provide a clearer picture of the economy.

The central bank hopes that an analysis of the frequency of internet job searches, or of prices online, may provide insights into the prospects for unemployment and inflation.

Andy Haldane, chief economist set up The Bank of England’s (BoE) special team, would explore how new unconventional sources of data could improve its picture of Britain’s recovery.

Haldane told the bank had started to explore using unconventional data, including data gleaned from analysing internet activity, after it found that it could be timelier than the official data.

Further Haldane said official statistics tend to be lagging and tend to be revised. And what this scraping of the web can do is give us a better today read on what’s going on. He added that these informal sources of data have been somewhat more reliable in picking up the uptick in the fortunes of the economy.

The BoE was able to impose new constraints on the housing market earlier in 2014 with the help of a massive database on mortgages a new data source used for the purpose.

According to Haldane the special team is constructing little models, algorithms and methods for data extraction, and has a data lab.