Forecasting can be defined as a set of hypothetical statements about future aggregate developments. It’s the process of attempting to predict the future condition of your business or economy. Forecasting is generally considered a method or technique for estimating several future aspects of an organization. Two basic forecasting methods include qualitative forecasting and quantitative forecasting.
Qualitative forecasting techniques generally use the judgment of experts to generate forecasts. A main advantage of these procedures is that they can be applied in situations where historical data are simply not available.
Quantitative forecasting methods are employed when historical data on variables of interest are available. These methods are based on an analysis of historical data concerning the time series of the specific variable of interest.
Forecasting is a structured way of looking into the future using all available information. Forecasting remains an integral part of the mainstream economics.