01967cas a2200265 a 4500 AALejournalIMF016802 230101c9999 xx r poo 0 0eng d 5.00 USD 9781484362068 1018-5941 BD-DhAAL BD-DhAAL Cimadomo, Jacopo. How do Experts Forecast Sovereign Spreads? / Jacopo Cimadomo, Peter Claeys, Marcos Poplawski Ribeiro. Washington, D.C. : International Monetary Fund, 2016. 1 online resource (46 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper assesses how forecasting experts form their expectations about future government bond spreads. Using monthly survey forecasts for France, Italy and the United Kingdom between January 1993 and October 2014, we test whether respondents consider the expected evolution of the fiscal balance-and other economic fundamentals-to be significant drivers of the expected bond yield differential over a benchmark German 10-year bond. Our main result is that a projected improvement of the fiscal outlook significantly reduces expected sovereign spreads. This suggests that credible fiscal plans affect market experts' expectations and reduce the pressure on sovereign bond markets. In addition, we show that expected fundamentals generally play a more important role in explaining forecasted spreads compared to realized spreads. Mode of access: Internet Claeys, Peter. Poplawski Ribeiro, Marcos. IMF Working Papers; Working Paper ; No. 2016/100 Full text available on IMF http://elibrary.imf.org/view/journals/001/2016/100/001.2016.issue-100-en.xml IMF e-Library