Konstantin Boss, Luigi Longo, Luca Onorante
arXiv 12 Jun 2025 · Econometrics
arXiv:2506.10546 · PDF · DOI · OpenAlex · Extracted main text
Using a state-of-the-art large language model, we extract forward-looking and context-sensitive signals related to inflation and unemployment in the euro area from millions of Reddit submissions and comments. We develop daily indicators that incorporate, in addition to posts, the social interaction among users. Our empirical results show consistent gains in out-of-sample nowcasting accuracy relative to daily newspaper sentiment and financial variables, especially in unusual times such as the (post-)COVID-19 period. We conclude that the application of AI tools to the analysis of social media, specifically Reddit, provides useful signals about inflation and unemployment in Europe at daily frequency and constitutes a useful addition to the toolkit available to economic forecasters and nowcasters.
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The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.
| Reference | Intensity | Mentions | Sections | Main text | |
|---|---|---|---|---|---|
| 1 | Barbaglia, L., Consoli, S., and Manzan, S (2024) Forecasting gdp in europe with textual data | 0.894 | 7 | 4 | 71% |
| 2 | Granziera, E., Larsen, V. H., Meggiorini, G., and Melosi, L (2025) Speaking of inflation: the influence of fed speeches on expectations | 0.737 | 5 | 2 | 60% |
| 3 | Breitung, J. and Roling, C (2015) Forecasting inflation rates using daily data: A nonparametric midas approach | 0.644 | 2 | 2 | 100% |
| 4 | Barigozzi, M. and Lissona, C (2024) Ea-md-qd: Large euro area and euro member countries datasets for macroeconomic research | 0.511 | 2 | 2 | 50% |
| 5 | Consoli, S., Barbaglia, L., and Manzan, S (2022) Fine-grained, aspect-based sentiment analysis on economic and financial lexicon | 0.511 | 2 | 1 | 100% |
| 6 | Touvron, H., Lavril, T., Izacard, G., Martinet, X., Lachaux, M.-A.,… (2023) Llama: Open and efficient foundation language models | 0.405 | 1 | 1 | 100% |
| 7 | Aliaj, T., Ciganovic, M., and Tancioni, M (2023) Nowcasting inflation with lasso-regularized vector autoregressions and mixed frequency data | 0.405 | 1 | 1 | 100% |
| 8 | Angelico, C., Marcucci, J., Miccoli, M., and Quarta, F (2022) Can we measure inflation expectations using twitter? | 0.405 | 1 | 1 | 100% |
| 9 | Aprigliano, V., Emiliozzi, S., Guaitoli, G., Luciani, A., Marcucci,… (2023) The power of text-based indicators in forecasting italian economic activity | 0.405 | 1 | 1 | 100% |
| 10 | Ashwin, J., Kalamara, E., and Saiz, L (2024) Nowcasting euro area gdp with news sentiment: a tale of two crises | 0.405 | 1 | 1 | 100% |
Showing the top 10 of 36 scored citations.
arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.
| Citing paper | Intensity | Mentions | Sections | |
|---|---|---|---|---|
| 1 | Nowcasting and aggregation: Why small Euro area countries matter | 0.644 | 2 | 2 |