Monetary Policy Analysis and Forecasting from edX

This online course, presented by the IMF's Institute for Capacity Development, introduces participants to quarterly projection macroeconomic models developed as a core of FPAS (Forecasting and Policy Analysis Systems) and how to implement the key canonical quarterly projection model (QPM) equations in a macroeconomic modeling software. This course uses detailed country data highlighting an inflation targeting central bank, for hands-on filtration and calibration exercises.

The course covers two main technical aspects:

introduction to a canonical New Keynesian model structure and its key properties; and
implementation of the QPM in Matlab/Octave and the application of IRIS toolbox for solving and maintaining the QPM.

In partnership with MathWorks, enrolled students have access to MATLAB for the duration of the course.

Monetary Policy Analysis and Forecasting is offered by the IMF with financial support from the Government of Japan.

What you'll learn

Upon completion of this course, participants should be able to:

Explain the key building blocks of a canonical semi-structural QPM.
Interpret the key model equations from a macroeconomic point of view.
Implement a simple QPM using a specialized software for macroeconomic modelling.
Distinguish the key elements of a QPM in a state-space form (i.e. shocks, observable and unobservable variables, measurement and transition equations, steady-state parameters, equation coefficients).
Identify necessary codes for data transformation, filtration and evaluation of the QPM properties.
Apply the basic IRIS Toolbox functions for solving the model.
Create output reports using model codes.
Develop a basic calibration of the QPM.

What's inside

Learning objectives

Explain the key building blocks of a canonical semi-structural qpm.
Interpret the key model equations from a macroeconomic point of view.
Implement a simple qpm using a specialized software for macroeconomic modelling.
Distinguish the key elements of a qpm in a state-space form (i.e. shocks, observable and unobservable variables, measurement and transition equations, steady-state parameters, equation coefficients).

Identify necessary codes for data transformation, filtration and evaluation of the qpm properties.
Apply the basic iris toolbox functions for solving the model.
Create output reports using model codes.
Develop a basic calibration of the qpm.

Explain the key building blocks of a canonical semi-structural qpm.
Interpret the key model equations from a macroeconomic point of view.
Implement a simple qpm using a specialized software for macroeconomic modelling.
Distinguish the key elements of a qpm in a state-space form (i.e. shocks, observable and unobservable variables, measurement and transition equations, steady-state parameters, equation coefficients).
Identify necessary codes for data transformation, filtration and evaluation of the qpm properties.
Apply the basic iris toolbox functions for solving the model.
Create output reports using model codes.
Develop a basic calibration of the qpm.

Good to know

Know what's good

, what to watch for

, and possible dealbreakers

Explains the basic building blocks of a canonical semi-structural quarterly projection macroeconomic model (QPM)

Provides hands-on experience in implementing a QPM using specialized software for macroeconomic modeling

Develops skills in distinguishing the key elements of a QPM in a state-space form

Teaches how to create output reports using model codes

Requires prior knowledge of macroeconomic modeling concepts and techniques

May not be suitable for beginners or those with limited experience in macroeconomic modeling

Activities

Be better prepared before your course. Deepen your understanding during and after it. Supplement your coursework and achieve mastery of the topics covered in Monetary Policy Analysis and Forecasting with these activities:

MATLAB Tutorial

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Master the basics of MATLAB, the software used for implementing QPM.

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Complete MATLAB tutorials
Practice with sample datasets

Review key macroeconomic concepts

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Reviewing macroeconomic concepts can help strengthen understanding of the theoretical framework used in the QPM.

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Seek mentorship

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Connect with experts to gain guidance, support, and insights into the field.

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Identify potential mentors
Reach out to mentors

Four other activities

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Review 'Monetary Policy Analysis and Forecasting'

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Study IMF's official textbook to grasp key concepts and gain insights from the course instructors.

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Read assigned chapters
Summarize and reflect on key points

Discuss and troubleshoot

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Connect with peers to resolve questions, share insights, and enhance understanding.

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Join discussion forums
Ask questions and share knowledge

Simulate and analyze QPM

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Simulate and analyze QPM to develop practical knowledge in macroeconomic modeling.

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Analyze results
Run simulations
Set up parameters and initial conditions

Create a policy brief

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Synthesize knowledge and apply QPM to real-world policy recommendations.

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Identify a policy issue
Use QPM to analyze the issue
Develop policy recommendations
Write and format the policy brief

Career center

Learners who complete Monetary Policy Analysis and Forecasting will develop knowledge and skills that may be useful to these careers:

Central Banker

Central Bankers are responsible for setting and implementing monetary policy, which has a significant impact on the economy. The Monetary Policy Analysis and Forecasting course provides a deep understanding of monetary policy and its effects on the economy. The course also provides hands-on experience with specialized software for macroeconomic modeling, which is a valuable skill for Central Bankers.

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Academic Researcher

Academic Researchers conduct research in various fields, including economics and finance. The Monetary Policy Analysis and Forecasting course provides a strong foundation in macroeconomic modeling and data analysis, which are essential skills for Academic Researchers. The course also introduces students to specialized software for macroeconomic modeling, which is useful for Academic Researchers in conducting their research.

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Economist

Economists study and analyze economic data and trends to provide insights into economic issues and policies. The Monetary Policy Analysis and Forecasting course provides a strong foundation in macroeconomic modeling, which is essential for understanding the complex interactions within an economy. The course also provides hands-on experience with specialized software for macroeconomic modeling, which is a valuable skill for Economists.

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Financial Analyst

Financial Analysts assess the performance of stocks, bonds, and other investments to help individuals and organizations make informed investment decisions. The Monetary Policy Analysis and Forecasting course provides a foundation in macroeconomic modeling, which is essential for understanding the factors that drive financial markets. The course also provides hands-on experience with specialized software for macroeconomic modeling, which is a valuable skill for Financial Analysts.

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Quantitative Analyst

Quantitative Analysts use mathematical and statistical techniques to analyze financial data and make investment decisions. The Monetary Policy Analysis and Forecasting course provides a strong foundation in macroeconomic modeling and data analysis, which are essential skills for Quantitative Analysts. The course also introduces students to specialized software for macroeconomic modeling, which is a valuable tool for Quantitative Analysts.

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Risk Analyst

Risk Analysts assess and manage financial risks for individuals and organizations. The Monetary Policy Analysis and Forecasting course provides a solid understanding of macroeconomic modeling and risk analysis, which are valuable skills for Risk Analysts. The course also provides hands-on experience with specialized software for macroeconomic modeling, which is useful for Risk Analysts in understanding and managing macroeconomic risks.

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Statistician

Statisticians collect, analyze, and interpret data to provide insights for various purposes. The Monetary Policy Analysis and Forecasting course provides a strong foundation in data analysis and macroeconomic modeling, which can be beneficial for Statisticians working in the financial or economic sectors. The course also introduces students to specialized software for macroeconomic modeling, which can be useful for Statisticians in building and analyzing economic and financial models.

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Investment Banker

Investment Bankers provide financial advice and services to corporations and governments. The Monetary Policy Analysis and Forecasting course provides a comprehensive understanding of macroeconomic modeling and financial markets, which is essential for Investment Bankers. The course also provides hands-on experience with specialized software for macroeconomic modeling, which is valuable for Investment Bankers in analyzing and advising clients on investment decisions.

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Data Scientist

Data Scientists use data and statistical techniques to solve business problems. The Monetary Policy Analysis and Forecasting course provides a foundation in data analysis and macroeconomic modeling, which can be useful for Data Scientists working in the financial or economic sectors. The course also introduces students to specialized software for macroeconomic modeling, which can be valuable for Data Scientists in building and analyzing economic and financial models.

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Financial Advisor

Financial Advisors provide financial advice and services to individuals and organizations. The Monetary Policy Analysis and Forecasting course may be useful for Financial Advisors who want to gain a deeper understanding of macroeconomic factors that affect financial markets and investment decisions. The course provides a foundation in macroeconomic modeling and data analysis, which can help Financial Advisors in making informed recommendations to their clients.

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Software Engineer

Software Engineers design, develop, and maintain software applications. The Monetary Policy Analysis and Forecasting course may be useful for Software Engineers working on projects related to macroeconomic modeling or financial analysis. The course provides a foundation in macroeconomic modeling and data analysis, which can help Software Engineers in understanding and implementing the relevant algorithms and models in their software applications.

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Consultant

Consultants provide professional advice and services to clients in various industries. The Monetary Policy Analysis and Forecasting course can be useful for Consultants, especially those working in the financial or economic sectors. The course provides a strong foundation in macroeconomic modeling and data analysis, which can help Consultants in understanding and advising clients on economic and financial issues.

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Product Manager

Product Managers are responsible for the development and launch of new products or services. The Monetary Policy Analysis and Forecasting course may be useful for Product Managers working on financial or economic products or services. The course provides a foundation in macroeconomic modeling and data analysis, which can help Product Managers in understanding the market and developing products that meet the needs of customers.

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Business Analyst

Business Analysts identify and solve business problems using data analysis and technology. The Monetary Policy Analysis and Forecasting course may be useful for Business Analysts working on projects related to macroeconomic modeling or financial analysis. The course provides a foundation in macroeconomic modeling and data analysis, which can help Business Analysts in understanding the business context and developing solutions to business problems.

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Project Manager

Project Managers plan, execute, and deliver projects. The Monetary Policy Analysis and Forecasting course may be useful for Project Managers working on projects related to macroeconomic modeling or financial analysis. The course provides a foundation in macroeconomic modeling and data analysis, which can help Project Managers in understanding the project scope and managing project risks.

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