Rwanda: Technical Assistance Report-Further Strengthening the Nowcasting Framework at the National Bank of Rwanda
Technical Assistance Reports, January 17, 2025
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- Rwanda: Technical Assistance Report-Further Strengthening the Nowcasting Framework at the National Bank of Rwanda
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Bibliographic details
- Published: January 17, 2025
- Series: Technical Assistance Reports
- DOI: https://doi.org/10.5089/9798400297335.019
Mission objectives and scope
- TA mission from the Monetary and Capital Markets (MCM) department conducted from October 9 to 18, 2023, at the request of the National Bank of Rwanda (NBR).
- Aim: enhance the NBR’s Forecasting and Policy Analysis System (FPAS) by strengthening nowcasting frameworks for Gross Domestic Product (GDP) and Consumer Price Index (CPI) inflation, and analyzing effects of weather shocks on food crop production and fresh food prices.
- Delivered through interactive technical sessions with NBR staff, hands-on training, and model adjustments.
Key findings and technical outputs
- Resolved discrepancies in the use of different Core CPI definitions between the medium-term Quarterly Projection Model (QPM) and nowcasting models, improving forecast evaluation.
- Established a system for analyzing the impact of weather shocks, particularly rainfall, on food crop production and fresh food prices.
- Provided hands-on training for NBR staff on:
- Using CPI nowcasting tools to monitor monthly inflation outcomes.
- Creating and interpreting uncertainty fan charts for GDP and CPI projections.
- Enhanced understanding and construction of high-frequency real sector indicators in GDP nowcasting models.
Capacity building and methods
- Interactive technical sessions improved staff ability to apply nowcasting frameworks to:
- Monitor CPI monthly outcomes in real time.
- Produce and interpret uncertainty fan charts for short-term GDP and CPI projections.
- Practical implementation of a rainfall-impact analysis system to link weather shocks to food production and fresh food prices.
- Strengthened methodological alignment between medium-term QPM and high-frequency nowcasting tools through harmonized Core CPI definitions.
Subjects and keywords (as listed)
- Consumer price indexes, Economic forecasting, Food prices, Food production, Inflation, Prices, Production
- AFRITAC East, Central Banking, Climate Risks, Consumer price indexes, crop production, Economic Forecasting and Analysis, Food prices, Food production, IMF Monetary, IMF's Monetary, Inflation, Monetary Policy, Nowcasting, Nowcasting framework, Rwanda.