What is the trend and volatility of the inflation rate over

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Reference no: EM132961734

Research Assignment: Inflation (CPI and GDP deflator)
You need to find information on annual inflation for your selected country and for Canada. This should be annual inflation based on the Consumer Price Index (CPI), and annual inflation based on the GDP deflator. The data should be from 2000 until the most recent available. You can determine which database is best for your selected country:
• IMF International Financial Statistics (IMF-IFS). This provides data for CPI inflation up to 2020, but not the latest 2021 data and future forecasts that are available on the IMF Datamapper. You can adjust the years to start from 2000, and there are many economic variables to choose from (you should choose annual % change; not seasonally adjusted). This site has two key advantages:
o you can produce a variety of different types of graph with the same data
o you can plot two economic variables at the same time, which is helpful when we are considering CPI inflation and GDP deflator inflation, which are similar
• World Bank Open Data only has some data up to 2019. You can set the time period to start in 2000. (You should use the "linked series" for the GDP deflator, if possible - this data series is explained
when you click on the ‘Details' button above the graph.)
data.worldbank.org
• IMF Datamapper. The key advantage of this site is that it includes very recent data up to Q1 2021 and forecasts into the future. However, it does not provide a GDP deflator graph. Also, the time period is fixed from 1980.
Try both World Bank and IMF-IFS sources, and see which you find better to use for your selected country. You can always use a graph from the World Bank or IMF-IFS sites, and then quote the latest CPI inflation figures from the IMF Datamapper.
Create two graphs (if using the World Bank), or one graph (if using the IMF-IFS site; although you might choose to create two separate graphs for each measure of inflation, in order to use interesting types of graph??). Your graph(s) should include both your selected country and Canada, for inflation (annual %) based on the CPI and based on the GDP deflator. When you are describing these graphs, consider the following questions:

a. What is the trend and volatility of the inflation rate over time, and the recent level of inflation, in your selected country compared to Canada?

b. What does the recent history of inflation in your selected country tell you about the stability of the economy? What does recent inflation experience say about the risk to a Canadian financial fund manager of investing funds in your selected country in the near future?

Attachment:- Research Assignment Instructions 2.rar

Reference no: EM132961734

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