Source: Wikimedia CommonsForecasting USD-MNT Exchange Rate — Part 1: ProphetA time series analysis of the Mongolian TugrikRobert RitzBlockedUnblockFollowFollowingDec 3Living in a developing country like Mongolia gives me a huge opportunity to embark on projects that are nearly or completely untouched by other data scientists..There is a clear seasonal trend to meat prices, with winter being the low and summer being high..I couldn’t find data on increasing prices for imported goods, so you will have to trust me that this is the case.Up up and away!Looking at the USD-MNT exchange rate, there is a very clear trend since 2008 of large and steady increases..This depreciation of the MNT has wide impacts for citizens, whose currency has less power, and for businesses, which often import their equipment or production input.Time Series Forecasting with ProphetFor this article I will forecast the USD-MNT rate using a time series method developed by Facebook called Prophet..The two plots below are, to me, the most useful things Prophet can do.On the left is a plot of the yearly trend of the USD-MNT exchange rate..It shows a clear trend of decreasing in the summer and increasing in the winter..This shows that, on average, the USD-MNT exchange rate decreases on Monday and increases each day after, peaking on Thursday..Those trends are merely an interpolation from Monday and Friday data.Next, you can see the time series forecast with a red trend line shown..One can imagine short term loans via LendMN or other non-banking financial institutions possibly follow a similar trend to the one above.Viewing the time series for the Euro and Yuan shows a similar story for the Tugrik..The Yuan looks quite similar to the Dollar time series, with little variation.Of note is that while the forecast for the USD-MNT for the next 180 days is relatively flat, the EUR-MNT forecast shows a steady increase..The USD-MNT exchange rate is determined by many external factors, and this analysis cannot account for those variables.In the next article we will attempt to forecast the USD-MNT exchange rate using a machine learning method that will incorporate outside (those external factors) data such as the balance of payments, foreign currency on reserve, and others..The 2 year forecast shows a reduction in prices!. More details