For this example, let us consider the impact of an interest rate change on currency fluctuations.
When a central bank manipulates interest rates — this is hypothesised to have a significant impact on a currency as it affects the perceived value of that currency relative to others in the market.
In order to determine whether such an intervention has a significant effect on a time series — we must use a suitable covariate (X).
While it is hypothesised that the currency will be affected by fluctuations in the greenback as well as many other macroeconomic conditions — it is assumed that the Bank of England intervention does not impact the EUR/USD.
This has been an introductory example to the causalimpact library and how the effects of interventions can be examined across a time series.
In a room along a little track, French influences converged with old English traditions of goat’s- and sheep’s-milk cheesemaking.
(Gott, who remembers Holbrook’s obsessive attention to detail—sourcing starter cultures from the Loire Valley, in France, and thistle stamens from Portugal—likes to say, “If you want to change a cheese, change the cheesemaker.”) But the human factors also extend further afield, to the hands that will package the cheese, the money that will purchase it, the shelves it will fill, and the mouths it will feed.
Innes Cheese, based at Highfields Farm Dairy, in Staffordshire, has been a site of goat’s-milk cheesemaking since 1987.
Last month, Bennett and Lawn’s flock of three hundred goats was driven more than a hundred and fifty miles north to a new home, at Holker Farm, in Cumbria, where Gott and Robinson have lived and made cheese since their year-long apprenticeship with Holbrook.