1. ZIMBABWE CASE STUDY

2. OUTLINE Structure of the economy Stationarity tests The VAR model
Results

3. 1. STRUCTURE OF THE ECONOMY
Monetary policy framework -The central bank is not under any monetary policy framework. - The Bank uses moral suasion to influence the financial markets -level of financial deepening improving due to the continued evolution of mobile - banking Implications The economy is highly susceptible to external shocks such as the US/rand exchange rate developmements

4. 2. Tests for stationarity

5. 3.ESTIMATING A VAR ordering of ariables - ry lp lenr lm3 lex
Lag determination
Testing for stability

6. 4. VAR MODEL COINTEGRATION EQUATION Comment
money supply and exchange rate explain GDP performance in Zimbabwe

7. 5a.Impulse response functions

8. 5b.Granger causality tests

9. 5c.Variance decomposition