Model-Based Monetary Policy Analysis and Forecasting Course

Following two years of virtual delivery, the course on Model-Based Monetary Policy and Forecasting (MPAF) was delivered in Vienna between November 28 and December 9, 2022. The course was attended by 15 participants from 9 countries, almost all central bankers from monetary policy and research departments. 

The MPAF course is one of the most advanced courses delivered at the JVI. The course presents the key concepts and tools in modern monetary policy analysis and forecasting. It does so by using a small semi-structural macroeconomic model, which is at the core of forecasting and policy analysis systems (FPAS) in many central banks in the JVI region nowadays. Additional tools, such as nowcasting and near-term forecasting, are also covered, including their role in the overall FPAS.

The emphasis is put on highly practical, hands-on sessions, which take more than half of the course. In particular, course participants learn how to set up and calibrate a generic model, but also how to adjust it to capture alternative monetary policy frameworks or exchange rate regimes. Extensions of the model (e.g., with fiscal policy) are also covered to demonstrate the flexibility of the framework.

In this latest delivery at the JVI, a significant part of the course was dedicated to the preparation of inputs for monetary policymakers to make informed decisions. Two workshop groups were established to work on and prepare macroeconomic analyses and projections for the Czech Republic in early 2022. They prepared a presentation for policymakers, including a policy recommendation, thus mimicking the real-life tasks of many course participants. Most of them stressed in their feedback that the knowledge acquired in the course was relevant for their job and research activities and formulating economically sound policy advice.

Rilind Kabashi, Economist, JVI