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1346.0.55.003 - Interpreting Time Series: Are you being misled by the Seasons, 2012  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 11/12/2012  First Issue
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EXAMPLE OF A SEASONAL ADJUSTMENT

STEP ONE:

Start with the original series of data regularly recorded each month or quarter

1. Original Series, Short-term visitor arrivals – Japan

1. Original Series, Short-term visitor arrivals – Japan


STEP TWO:

Estimate seasonal pattern

2. Seasonal Factors, Short-term visitor arrivals – Japan

2. Seasonal Factors, Short-term visitor arrivals – Japan


STEP THREE:

Remove estimated seasonal pattern to produce seasonally adjusted estimates

3. Seasonally Adjusted Series, Short-term visitor arrivals – Japan

3. Seasonally Adjusted Series, Short-term visitor arrivals – Japan


STEP FOUR:

Smooth noise from seasonally adjusted estimates to produce trend estimates

4. Trend Series, Short-term visitor arrivals – Japan

4. Trend Series, Short-term visitor arrivals – Japan


STEP FIVE:

Seasonally adjusted and trend estimates are produced

5. Trend and Seasonally Adjusted Series, Short-term visitor arrivals – Japan

5. Trend and Seasonally Adjusted Series, Short-term visitor arrivals – Japan

Note: The difference between seasonally adjusted estimates and the trend estimates is the residual noise and irregular series. In the above example, the irregular includes the effects of major short-term events: the September 2001 terrorist attacks in the USA, and the SARS epidemic in 2003.


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