Central Banks’ Staff Trained on Monetary Policy Formulation Methods

Thirty-two economists from 12 Central Banks in the COMESA region have been trained on the basic Dynamic Stochastic General Equilibrium (DSGE) Modelling and Time Series Analysis. These are used in monetary policy formulation in inflation and targeting monetary policy regime to which most COMESA Central Banks are transitioning.

The training was conducted virtually on 11 – 15 July 2022 by the COMESA Monetary Institute (CMI). The following countries participated Democratic Republic of Congo, Comoros, Djibouti, Egypt, Eswatini, Ethiopia, Malawi, Mauritius, Rwanda, Sudan, Zambia and Zimbabwe.

The training responds to the needs of contemporary monetary policy formulation, which requires information and forecasts on the interaction between sectors and variables in the economy.

According to CMI Director, Mr. Ibrahim Zeidy, this could be better understood through the DSGE modelling framework, which has richer micro-foundation that captures economic relationships than other comparable models.

“There is no doubt, therefore, that the knowledge gained from the training will contribute to improved monetary policy formulation and ultimately enhance the implementation of the COMESA Monetary Integration Programme by all COMESA member countries,” said Mr Zeidy.

At the end of the workshop, the participants attested to having developed and enhanced their skills to build small to medium scale DSGE model for their respective countries.