## Jordan: Technical Assistance Report-Forecasting Framework for Currency in Circulation

_IMF Staff Country Reports, April 7, 2022_

## Source details

**Canonical URL:** [Jordan: Technical Assistance Report-Forecasting Framework for Currency in Circulation](https://www.imf.org/en/publications/cr/issues/2022/04/07/jordan-technical-assistance-report-forecasting-framework-for-currency-in-circulation-516259)

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## Bibliographic details
- Published: April 7, 2022
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400205972.002

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### Summary and key finding
- The currency in circulation forecasting model presently used by the Central Bank of Jordan is aligned with international practices and provides a solid basis for liquidity management.
- The central bank uses an Auto Regressive Integrated Moving Average (ARIMA) model with many indicator variables to model binary seasonality and to capture special events.
- The ARIMA model is fitted on daily currency in circulation data using a standard maximum likelihood estimator.
- This ARIMA approach is aligned with the models traditionally used by central banks in emerging and middle-income countries.

### Model specification and methodology
- Model type: Auto Regressive Integrated Moving Average (ARIMA).
- Additional features: Many indicator variables to model binary seasonality and to capture special events.
- Estimation method: Standard maximum likelihood estimator.
- Data frequency: Daily currency in circulation data.

### Relevance and alignment with practice
- Alignment: The approach is consistent with international practices and with models traditionally used by central banks in emerging and middle-income countries.
- Policy application: Provides a solid basis for liquidity management at the Central Bank of Jordan.

### Publication and document metadata
- Publication date: April 7, 2022
- Pages: 38
- Volume: 2022
- Issue: 101
- Series: Country Report No. 2022/101
- DOI: https://doi.org/10.5089/9798400205972.002
- Stock No: 1JOREA2022002
- ISBN: 9798400205972
- ISSN: 1934-7685
- Subjects: Central banks; Currency issuance; Economic forecasting; International organization; Monetary base; Monetary policy; Money; Open market operations
- Keywords: ARIMA model; Currency issuance; Global; hierarchy forecasting; IMF team; Monetary base; moving average; Open market operations; staff level agreement

*International Monetary Fund. Jordan: Technical Assistance Report-Forecasting Framework for Currency in Circulation (IMF Staff Country Reports 2022, 101).*

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_Source: https://www.imf.org/en/publications/cr/issues/2022/04/07/jordan-technical-assistance-report-forecasting-framework-for-currency-in-circulation-516259_