Forecasting South African Gold Sales: The Box-Jenkins Methodology

Johannes Tshepiso Tsoku (), Nonofo Phokontsi () and Daniel Metsileng ()
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Johannes Tshepiso Tsoku: North West University
Nonofo Phokontsi: North West University
Daniel Metsileng: Department of Health

No 2704589, Proceedings of International Academic Conferences from International Institute of Social and Economic Sciences

Abstract: The study deals with Box-Jenkins Methodology to forecast South African gold sales. For a resource economy like South Africa where metals and minerals account for a high proportion of GDP and export earnings, the decline in gold sales is very disturbing. Box-Jenkins time series technique was used to perform time series analysis of monthly gold sales for the period January 2000 to June 2013 with the following steps: model identification, model estimation, diagnostic checking and forecasting. Furthermore, the prediction accuracy is tested using mean absolute percentage error (MAPE). From the analysis, a seasonal ARIMA(4,1,4)×(0,1,1)12 was found to be the ?best fit model? with an MAPE value of 11% indicating that the model is fit to be used to predict or forecast future gold sales for South Africa. In addition, the forecast values show that there will be a decrease in the overall gold sales for the first six months of 2014. It is hoped that the study will help the public and private sectors to understand the gold sales or output scenario and later plan the gold mining activities in South Africa. Furthermore, it is hoped that this research paper has demonstrated the significance of Box-Jenkins technique for this area of research and that they will be applied in the future.

Keywords: Gold sales; ARIMA; Box-Jenkins; GDP; MAPE (search for similar items in EconPapers)
JEL-codes: C10 C19 C53 (search for similar items in EconPapers)
Pages: 11 pages
Date: 2015-09
New Economics Papers: this item is included in nep-for
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Published in Proceedings of the Proceedings of the 18th International Academic Conference, London, Sep 2015, pages 761-771

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