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Impact on the output of changes in monetary policy are realized through the monetary transmission mechanism. Exchange rate channel that one of the monetary transmission mechanism ise a make to direct influence on the net export volume in the floating exchange rate regime. The aim of this study is to investigate efficiency of the exchange rate channel on the real economic variables in Turkey that adopted the floating exchange rate regime after the financial crisis in 2001. In study was made an empirical application in the framework of the VAR model using quarterly data for the period Turkey's 2003:Q1-2012:Q4. Test results which on size of short-term interest rate, the real exchange rate, net exports and gross domestic product were observed that the exchange rate channel doesn't work effectively in Turkey. [ABSTRACT FROM AUTHOR]

Monetary transmission mechanism explains the influence of monetary policy on the real economy via what channels, how long and to what extent this implies that. Main channels of monetary transmission mechanism are grouped of interest channels, consumer channels, the real wealth effect channel, exchange rate channel, the credit channel and the expectations channel. Which of said channels operate more efficiently vary from country to country in relation to the structure of the national economy, the size of it and the openness degree of country.In this study, it is tested that the expectations channel of monetary transmission channels for Turkey's economy is valid or not.In the study, a monthly basis data sets for the period 2007:01-2014:01 which are obtained from reserve currency, the real sector confidence index and the industrial production index on the ADF and DF-GLS are subjected to unit root test. Causality between variables was tested with analysis of causality developed by Toda and Yamamoto (1995). According to the results, it has been found that casuality relationship istwo-ways between real sector confidence index and industrial production index while there is one-way of that from reserve money into the real sector confidence index. In other words, the liquidity provided by the increase in the amount of money and consequently the positively affected real sector confidence index have a possitive impact on industrial production and investment levels.The final findings demostrate that the expectations channel is valid in Turkish economy. [ABSTRACT FROM AUTHOR]

In general, monetary policy changes have a strong impact on financial markets and real economy through various channels, among others the interest rate channel, credit channel, exchange rate channel and asset price channel. This process through which monetary policy decisions impact on an economy in general and the interest rate in particular is known as the monetary policy transmission mechanism. Hence monetary authorities are supposed to know the relationship between monetary aggregates and interest rates in a certain monetary policy regime and the determinants that affect this relationship. The purpose of this paper is to analyze the interest rate channel in Turkey from the perspective of monetary policy transmission channel. The results from our empirical analysis, using quarterly data and applying the VAR model during the period between 2000:1 and 2011:3, it is suggest that traditional transmission mechanism works properly in Turkey. [ABSTRACT FROM AUTHOR]