  In this article, we present a method to forecast the Portuguese gross
domestic product (GDP) in each current quarter (nowcasting). It combines bridge
equations of the real GDP on readily available monthly data like the Economic
Sentiment Indicator (ESI), industrial production index, cement sales or exports
and imports, with forecasts for the jagged missing values computed with the
well-known Hodrick and Prescott (HP) filter. As shown, this simple multivariate
approach can perform as well as a Targeted Diffusion Index (TDI) model and
slightly better than the univariate Theta method in terms of out-of-sample mean
errors.
