Now-Casting and the Real-Time Data Flow

The term now-casting is a contraction for now and forecasting and has been used for a long time in meteorology and recently also in economics. In this chapter we survey recent developments in economic now-casting with special focus on those models that formalize key features of how market participants and policymakers read macroeconomic data releases in real-time, which involves monitoring many data, forming expectations about them and revising the assessment on the state of the economy whenever realizations diverge sizeably from those expectations.