Modelling the currency in circulation for the State of Qatar

Abstract

Purpose

This paper seeks to model the daily and weekly forecasting of the currency in circulation (CIC) for the State of Qatar.

Design/methodology/approach

The paper employs linear forecasting models, the regression model and the seasonal ARIMA model to forecast the CIC for Qatar.

Findings

Comparing the linear methods, the seasonal ARIMA model provides better estimates for short‐term forecasts. The range of forecast errors for the seasonal ARIMA model forecasts are less than 100 million QR for the short‐term CIC forecasts.

Practical implications

The findings of this paper suggest that the CIC in Qatar is in a pattern and it would be easier to forecast the currency in circulation in Qatar economy. Accurate estimates of money market liquidity would help Qatar Central bank, to maintain the price stability in the Qatar economy.

Originality/value

This paper forecasts the currency in circulation for the State of Qatar. Additionally, the empirical part of the paper compares the different methodologies find the appropriate model for the CIC for the state of Qatar.

Citation

Balli, F. and Mousa Elsamadisy, E. (2012), "Modelling the currency in circulation for the State of Qatar", International Journal of Islamic and Middle Eastern Finance and Management, Vol. 5 No. 4, pp. 321-339. https://doi.org/10.1108/17538391211282827