In this paper we propose a new indicator of monthly global real economic activity, namedudworld steel production. We use world steel production, OECD industrial production indexudand Kilian’s rea index to forecast world real GDP, and key commodity prices. We find thatudworld steel production generates large statistically significant gains in forecasting world realudGDP and oil prices, relative to an autoregressive benchmark. A forecast combination of theudthree indices produces statistically significant gains in forecasting world real GDP, oil,udnatural gas, gold and fertilizer prices, relative to an autoregressive benchmark.
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