Forecasting is an important part of governments’ monetary and fiscal policies. Every forward-looking government uses economic forecasting as a necessary prerequisite for the success of its monetary and fiscal policies. Though economic forecasts are necessary, as they are essential underlying features of governments’ monetary and fiscal policies, economic forecasting is a difficult task. The difficulty in economic forecasting arises from the interplay of variables which certainly produces forecast errors. This study focused on minimizing the impact of forecast error on government monetary and fiscal policies through the use of suitable forecasting software. Hence in this study, forecasting software are examined as necessary tools for minimizing the impact of forecast errors on governments’ monetary and fiscal policies. Data is collected from both primary and secondary sources to elicit useful information from stakeholders in Forecasting Industry. The result of the study shows that there is a positive relationship between the use of forecasting software and minimizing the impact of forecast error on governments’ monetary and fiscal policies. The study revealed that the use of sound software, devoid of mathematical errors and inappropriate methods, will minimize the impact of forecast error on governments’ monetary and fiscal policies. The study also revealed that the major way to ensure an effective forecasting process and reduce forecast errors is to make use of intelligent forecast software that raises forecast accuracy.