Trend Analysis of Inflation Rate of Bangladesh – Modelling Approach

Abstract

In this paper, we have conducted an analysis on a set of data of the inflation rate of Bangladesh from the period July2002 to June2007
collected from Bangladesh Bank. We endeavored to deduce a unique and conventional model to assess the trend of the inflation rate of
Bangladesh. For this purpose, we adopted the trend analysis modeling method. We used four statistical models, such as, Linear Trend
model, Quadratic Trend model, Exponential Growth Trend model and S-curve Trend model to assess the trend of Inflation rate of
Bangladesh. From this study, we have found that Linear Trend model, Quadratic Trend model and Exponential Growth Trend model are
not pertinent for our concerned data set. S-curve Trend model with parameters β0=13.7210, β1=21.1242, and β2=0.929396 is appropriate
for our data set. So we can suggest that for assigning the trend of the inflation rate of Bangladesh, one can use the S-curve Trend model as
it gives better result than any of the three other models that we used in our study. But one must verify the validity of the model at different
time period before using this, because the validity of a model may differ at different situations with the change of time.