Modelling of manufacturing index with TRAMO/SEATS method: Comparing of direct and indirect approaches

Time series show that seasonal movements repeated from year to year. These seasonal movements conceal the characteristics of the economic time series and prevent to make reliable analysis. For this reason, economic time series are adjusted from these movements. The most appropriate modeling method for removing seasonal movements from time series is quite important. The use of model-based TRAMO / SEATS seasonal adjustment method has been increasing in recent years. In this study, TRAMO / SEATS method has been applied to the Manufacturing Production Index and 24 sub-sectors published by the Turkish Statistical Institute. The optimal models that reveal the seasonal structure of the series have been determined according to this method. Later, direct and indirect approaches used as the seasonal adjustment approach for the aggregated series were applied to the Manufacturing Production Index and It has been investigated which approach is more appropriate.