We use our latest (as of 2026 Q1) AI-based economic scenario generator (ESG) to generate hundreds of economic scenarios. All generated scenarios are based on the Q4 2025 starting point and cover 20 quarters (5 years). The scenarios have 12 macroeconomic variables: In the following sections, we illustrate the distributions of economic variables within the […]
Category: Economic Scenario Generator
Robustness of the AI-based Economic Scenario Generator
Econometric Scenario Generators (ESG) are key instruments in financial risk management. As such, the quality and robustness of the generated scenarios are important factors for reliable risk management. A key indicator of ESG quality is a reasonable correlation between economic variables and the preservation of stylized facts in the generated scenarios. In this post, we […]
Correlations in AI-generated Economic Scenarios, 2025
One important feature of the Economic Scenario Generators (ESG) is the reproduction of stylized facts observed in the historical data. While it might be challenging to quantify all stylized facts, a simple comparison of correlations between the historical data and the generated scenarios can provide significant insights into the behaviour of economic variables. We use […]
Future-Proofing Financial Risk: AI-based Economic Scenario Generator vs. Traditional Statistical ESG
In an era of increasing economic volatility, accurate risk measurement has become the cornerstone of financial resilience. Economic Scenario Generators (ESGs) – sophisticated models that simulate potential future economic conditions – stand at the core of risk management in financial organizations. Scenarios generated with an ESG allow financial professionals to assess the risk under various […]