Combining Forecast in Modeling Macro-Finance Variables

Quantitative analysis of the impact of financial variables on real economic activity would be the purpose of this paper. Focusing on interest rate spread, stock market and exchange rate as financial variables, the strength of our study compared to the existing literature will be the consideration of the dynamic of these financial variables and the use of forecast combination. This approach would lead better understanding on the relationship between financial and economic spheres. Interest on using financial variables for real GDP predictor will be tested through forecast encompassing principles.