Trend, Business Cycles and Fibonacci retracements in the Kenya GDP data 2000 to 2011

Abstract

GDP is one of the major measures of economic growth of a country (Kira, 2013). The Kenyan GDP 2000 to 2011 seems to indicate a general trend of growth, a further movement with the business cycles (World Bank, 2011). Moreover, the short ups and downs may seem a random stochastic movement. The question was: how could the seemingly random movement, in the GDP data, be explained so as to enhance better decision making in future? This paper sought to dissect the GDP data into trend, business cycles and to examine the relevance of the Fibonacci sequence and its derivative ratios, in particular, to the GDP data for 2000 to 2011 period. It sought to find out whether Fibonacci analysis; if it were used in the GDP data would give the decision makers a better per view of the trend in the economy