France: A reading of economic activity through Google trends

In order to trace more precisely changes in economic activity and, in particular, the impact of the lockdown measures introduced to curb the Covid-19 pandemic, we developed activity indicators calculated based on Google Trends. The underlying assumption behind the use of Google Trends is that the number of occurrences of keyword searches reflects economic agents' behaviour in terms of spending and investment, but also their general state of mind (confidence). We use two neural network methods to obtain indications on changes in economic activity in real time. The predictive nature of these indicators, particularly in terms of GDP forecasts, must be treated with caution, as it is linked to the choice of the Google Trends considered or the method used. Nevertheless, they have the advantage of providing an almost instantaneous alternative reading of the economic situation and providing additional information revealing the changes at work, particularly in terms of economic dynamics.