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Macroeconomic Effect Of Covid-19 On West African Monetary Zone (Wamz): A Fan Chart Probability Forecast Analysis

Author

Listed:
  • Ngozi E. Egbuna (PhD)

    (West African Monetary Institute, Accra, Ghana)

  • Augustine Ujunwa (PhD)

    (West African Monetary Institute, Accra, Ghana)

  • Nathan Pelesai Audu (PhD)

    (West African Monetary Institute, Accra, Ghana)

Abstract

The outbreak of COVID-19 pandemic presents an unprecedented and synchronized disruption of the economies of the West African Monetary Zone (WAMZ). This study uses the Conditional Fan Chart based on Vector Error Correction Model (VECM) to forecast the effects of the pandemic on three key macroeconomic variables that include consumer price index, gross domestic product, and external reserves. Annualized data spanning from 2000Q1 to 2020Q2 were used to forecast the macroeconomic effects of COVID-19 on the economies of WAMZ Member States from 2020Q3 to 2022Q4. The result forecast general deterioration in the selected macroeconomic variables. The pessimistic scenario further reveals that heightened uncertainty, the prominence of downside side risks from the second wave will worsen economic conditions in the WAMZ.

Suggested Citation

  • Ngozi E. Egbuna (PhD) & Augustine Ujunwa (PhD) & Nathan Pelesai Audu (PhD), 2020. "Macroeconomic Effect Of Covid-19 On West African Monetary Zone (Wamz): A Fan Chart Probability Forecast Analysis," West African Journal of Monetary and Economic Integration, West African Monetary Institute, vol. 20(1b), pages 38-76, June.
    • Handle: RePEc:wam:journl:v:20:y:2020:i:1b:p:38-76
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    More about this item

    Keywords

    COVID-19; Macroeconomic Effect; Fan chart; WAMZ;
    All these keywords.

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts

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