Search

This study sets out to examine the effects of the interaction of subsidy removal on premium motor spirit (PMS) and exchange rate devaluation on macroeconomic instability in Nigeria. In this regard, this study adopted the Bayesian vector autoregressive model (BVAR) identified with sign‐and‐zero restrictions for annual data between 1985 and 2022. The empirical results reveal that both the removal of subsidies on PMS and the devaluation of the naira exchange rate significantly undermine real gross domestic product (GDP) growth and raise inflationary pressures in Nigeria. One important implication of this finding is that the ongoing subsidy reforms in the energy sector and associated devaluation of the naira exchange rate raise the risk of stagflation in Nigeria. Secondly, the simulation shows that simultaneous subsidy removal on PMS and exchange rate devaluation can trigger macroeconomic instability. This finding implies that stabilising PMS price and the exchange rate is key to achieving macroeconomic stability in Nigeria. Thus, this study recommends that Nigeria should be cautious and act quickly to cushion the price of PMS from the vagaries of foreign exchange market fluctuations to improve macroeconomic stability in the country. [ABSTRACT FROM AUTHOR]

We test the impact of globalization on the inflation process (global slack hypothesis) for 15 emerging economies over the period (1996Q1-2019Q4). The novelty of this article lies in testing the impact of globalization on the inflation process. We introduce the smooth transition regression (STR) model of the Phillips curve to capture the gradual impacts of globalization on inflation dynamics. The main results are as follows. (i) The asymmetries in inflation exist that are not captured by the linear Phillips curve. (ii) The domestic output gap remains a main driving force of inflation. (iii) Globalization based on the trade weighted average of the domestic output gap does not affect the inflation process compared to other variables like the trade openness, import prices, real exchange rate and international oil prices. Our results yield important implications that the central banks of the emerging economies can stabilize inflation and output gap in an effective way, exploiting the inflation-output gap relationship. When economic expansion of the trading partners increases, the process of inflation dynamics changes in two economies (Brazil, and China). [ABSTRACT FROM AUTHOR]

This study analyzes the response of economic fundamentals to a misalignment shock of the real effective exchange rate in Korea. The estimation results of the equilibrium exchange rate determination model and time series model show that there is no significant difference in the direction of the deviation from equilibrium and that the won is significantly undervalued during the period before 1988, or during the currency and global financial crises. The cumulative impulse response analysis of the VAR model over the full period shows that an upward shock to the deviation from the equilibrium exchange rate reduces the GDP gap and inflation rate, while the effect on the call rate is not statistically significant. Furthermore, an upward misalignment shock initially worsens the goods and services balance, but the deficit in the goods and services balance shrinks significantly over time. In rolling regressions analysis, the entire sample is divided into two periods to estimate the impulse response function from the first period, and then the same procedure is repeated by moving the sample forward one by one. The cumulative impulse response results show that, as is the case for the full period, a positive exchange rate misalignment shock initially reduces the GDP gap, inflation, and worsens the goods and services balance, but the impact of this upward shock on these variables becomes increasingly weaker in the more recent sample. It also shows that the negative impact of upward shocks on the current account is smoothed out more recently during periods of undervaluation than during periods of overvaluation. [ABSTRACT FROM AUTHOR]

Exchange rate pass-through (ERPT) represents a degree to which changes in nominal exchange rates are transmitted into domestic prices. European Union (EU) countries have experienced the unprecedented inflationary pressure due to high geopolitical risk events. As such, understanding the ERPT plays a crucial role. This study provides a comprehensive and up-to-date analysis of ERPT to import prices for 16 EU countries from January 2006 to December 2022. Using the panel autoregressive distributed lag (ARDL) model, our findings confirm the linear, rather than nonlinear, ERPT pattern characterized by a diminishing trend over time in the EU countries. However, the degree of pass-through varies depending on country characteristics. Specifically, countries that are highly dependent on imports experience a larger ERPT. Furthermore, the degree of pass-through to import prices is more significant and persistent during periods of high uncertainty. These findings are robust across various robust analyses including sub periods. Our findings provide that help policymakers evaluate the trade-offs between exchange rate risks and macroeconomic stability during times of high uncertainty. [ABSTRACT FROM AUTHOR]

In recent years, due to the existence of severe sanctions and obstacles governing the sale of oil, it has led to an increase in the exchange rate, and on the other hand, the decrease in foreign exchange resources has led to a decrease in the government’s income, and the limitation of the income due to the financial policies of the government has made it difficult to meet the expenses of the government does not give and as a result the budget deficit has caused many problems in the economic system of the government. The government’s budget deficit leads to borrowing from the central bank or banks, and ultimately to the growth of the monetary-liquidity base, inflation and a decrease in the value of the national currency against foreign currencies. In this article, the effects of optimal monetary policy on these variables are investigated and the existing research gap is closed. Based on this, the main goal of this research is to investigate the effect of optimal monetary policy on controlling inflation and exchange rate. The current research method is practical. The period of the current research was 1357 to 1398. To estimate the model, the self-regression econometric model with distributed interruptions or ARDL was used in Microfit 5 software space. With the increase in money supply and the lack of proportional and symmetrical increase in the production of goods, the tendency to import goods increases, and in this case, pressure is put on the current price of the exchange rate and the causes of its increase are provided. Optimal monetary policies have a positive and significant effect on controlling inflation and exchange rate. Optimal monetary policies have a positive and significant effect on controlling the exchange rate. As a result, according to the results of the model, the liquidity situation and income inequality have worsened during the period under review, and as a result, the monetary policy in the country was not effectiv [ABSTRACT FROM AUTHOR]

The article proposes a typology of inflation regimes based on the Post-Keynesian and structuralist literature. We identify three separate regimes: the low, moderate and high inflation regimes. Hyperinflation is also defined and described. Each regime presents different characteristics. We identify the key role played by the distributive conflict between workers and capitalists in all the regimes, the role played by the indexation of wages on domestic prices in the moderate and high inflation regimes and the specific roles played by the widespread indexation on a short-term basis in the high inflation regime. Hyperinflation is explained by self-fulfilling prophecies about exchange rate variations and by the rejection of the domestic currency. [ABSTRACT FROM AUTHOR]

This paper displays the monthly and yearly currency exchange inflation of the Cuban Peso (CUP) in the national black market since the appearance of the Ordenamiento policy. Being served by ElToque's advanced algorithm coverage on more than 150 online marketplaces, the public historical data on the value of the CUP is converted into monthly and yearly data on exchange rate inflation. The paper, moreover, aims to discuss the Central Bank's matching of exchange rate data with factual popular behavior in contrast with the findings on the black market, which effectively proved abrupt differences. Thus, the blackmarket data insights represent key information while further research is being conducted on the Cuban economy. [ABSTRACT FROM AUTHOR]

Copyright of Jurnal Ekonomi Manajemen Sistem Informasi (JEMSI) is the property of Dinasti Publisher and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Purpose: This paper examines the impact of global crises, including the Global Financial Crisis (GFC), the COVID-19 pandemic, and the subsequent inflation crisis, on the fluctuations of the Real Effective Exchange Rate (REER). The cyclicality of REER has been examined as influenced by economic shocks, highlighting how pandemic-induced economic disruptions have reshaped REER dynamics differently from the more financially triggered fluctuations of the Global Financial Crisis. Design/methodology/approach: The methodology employs a comparative spectral analysis approach, utilizing time-series data to track REER movements across various countries. Findings: The findings indicate that the GFC and the COVID-19 pandemic led to shortening periods of cyclicality. Moreover, there has been a noticeable improvement in the synchronization of REER movements post-GFC, suggesting that economies may converge in their responses to global economic shocks. This convergence implies a potential stabilization of exchange rate movements in the face of future crises, underlining the importance of coordinated monetary policies. Research limitations/implications: To model the REER index, one can use also classical analytical methods such as VAR models, where macroeconomic factors can serve as variables. In spectral analysis itself, other filters like the Hodrick-Prescott filter or applying a spectral window can be used. Practical implications: The conducted study implies an improvement in synchronization among financial systems, with this knowledge, more appropriate and rational monetary decisions can be made, and private entities can better employ hedging strategies against currency exchange rate fluctuations. The study also aids in identifying inflationary pressures and the impact of the global financial system on the inflation index in individual countries. Originality/value: The methods used in the article represent an innovative approach to modeling the REER index, providing new insights into the cyclicality of the index and the shortening periods of its occurrence. The article is addressed both to researchers in this field and to individuals involved with the monetary system and those working in the financial industry. [ABSTRACT FROM AUTHOR]

This research aims to determine the effect of inflation, interest rates and exchange rates on company value using data from the financial reports of companies listed on the Indonesia Stock Exchange for the 2019-2023 period. The type of data used is quantitative data. The data source used is secondary data. The analytical tool used in panel data linear regression is EViews version 10. Simultaneous research results of the variables Inflation, Interest Rates and Exchange Rates have no influence on Company Value. Meanwhile, in partial testing, the variables inflation, interest rates and exchange rates have no effect on company value in banking institutions listed on the Indonesian Stock Exchange for the 2019-2023 period. [ABSTRACT FROM AUTHOR]

The aim of this study is to delve into the intricate the mechanism through which alterations in currency exchange rates give rise to shifts in inflation rates, while taking into careful consideration the country's economic cycle. In order to accomplish this objective, we used a dataset that spanned from 1 January 1999 to 1 July 2023, focusing our analytical lens on three specific geographic areas, namely the Eurozone, the United Kingdom, and Canada. In our pursuit of understanding this complex relationship, we employed the Markov Switching Vector Autoregressive model. Our research outcomes can be succinctly encapsulated as follows: in the initial stages, particularly during phases characterized by robust economic growth, the transmission of exchange rate effects onto inflation levels appeared to exhibit a partial impact across all geographic areas under examination. However, during periods marked by economic downturns, both the United Kingdom and Canada displayed a distinctly more comprehensive transmission of these effects. Moreover, the prevailing projections for the forthcoming time horizon, across all the countries encompassed by our study, strongly indicate the onset of an expansionary phase that is projected to extend over a span of 25 months. Lastly, concerning the implications of unexpected disturbances or shocks, it is noteworthy that the response of exchange rates to inflation induced shocks was neither immediate nor as pronounced as the corresponding reaction of inflation to sudden shifts in exchange rates. [ABSTRACT FROM AUTHOR]

Copyright of Economic & Regional Studies/Studia Ekonomiczne i Regionalne is the property of Sciendo and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Global Journal of Economics & Business is the property of Refaad for Studies, Research & Development and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Ghana was the second African country to adopt the inflation-targeting framework in 2007. The country faced persistently high levels of inflation, exceeding 100 percent in the early 1980s. Since the adoption of the inflation targeting regime, the inflation rate has decreased and remains below 20 percent. Given the importance of the policy mix in achieving price stability and economic growth in any economy, this study examines which policy mix is more effective in determining the inflation dynamics in Ghana. Annual data from 1980 to 2021 and the autoregressive distributed lag (ARDL) were used, firstly on individual monetary and fiscal policy models and then jointly on the policy mix model. Results show that fiscal policy is effective and significant in determining inflation dynamics in Ghana in the long run, while monetary policy is ineffective, less dominant, and statistically insignificant. Monetary policy is effective and significant in the short run. Based on the findings of the study, policy recommendations include giving more attention to the possible coordination of fiscal and monetary policies than has been previously given. The study's originality is in examining if the monetary or fiscal policy (policy mix) effectively regulates the inflation rate in Ghana; the inflation target and the exchange rate as external shocks were included, amongst others and estimating the separate and combined models for the policy mix. [ABSTRACT FROM AUTHOR]

A number studies have been conducted to establish the relationship between uncertainty and macroeconomic variables, such as inflation. Subsequently, economists constructed a time-varying uncertainty index, which is referred to as the World Uncertainty Index (WUI). This study aims to identify the effect of time-varying uncertainty subject to inflation in ASEAN. Using yearly dataset of the WUI as a proxy for the global level of domestic uncertainty, inflation, gross domestic product (GDP), foreign direct investment (FDI), and exchange rate from 2015 to 2019 for all ASEAN Member States (AMS), a twostep System Generalized Method of Moments (Sys-GMM) was employed to estimate the dynamic relationship and the short- and long-run effect of the socioeconomic uncertainty proxies with respect to inflation in ASEAN. The results indicated that uncertainty had positively and significantly affect inflation in the short-run estimation, along with GDP. Meanwhile, in the long-run estimation, it was only GDP that affected inflation, rather than uncertainty. [ABSTRACT FROM AUTHOR]

The global market for halal products is now developing at an extremely fast pace. Every year, there is a growing need for halal items. The reality is that Indonesia, the largest Muslim nation, is still under government scrutiny due to its poor exports of halal goods to the global halal market and its significant lag behind non-Muslim nations. This study used a quantitative methodology and multiple linear regression analysis to assess secondary data that was obtained via the Central Bureau of Statistics and Bank Indonesia's official websites. According to the partial research findings, the Rupiah exchange rate (X2) and the inflation variable (X1) have a favorable impact on Indonesia's export of halal items (Y) from 2018 to 2022; however, interest rates (X3) have a negative impact. Indonesia's halal product exports were impacted concurrently in 2018-2022 by the following variables: interest rates (X3), the Rupiah exchange rate (X2), and the inflation variable (X1). In terms of Islamic economics, export is allowed since it is a type of commerce that involves the purchase and sale of products and services. All transactions involving these kinds of transactions must adhere to Islamic law, one of which concerns the halalness of the goods and services being delivered. [ABSTRACT FROM AUTHOR]

We investigate the response of aggregate demand (AD) components and inflation to monetary policy (MP) shocks in the Tunisian context where studies on this issue are rare. By estimating SVAR models on historical data ending in 2021, we found that: i) The Tunisian Central Bank's (TCB) efforts to control inflation through interest rate tightening end up significantly slowing down private investment and consumption, while inflation response is not enough to mitigate the recently exacerbated inflationary trend; ii) Such efforts are hampered, if not outweighed, by the "pass-through" effect associated with exchange-rate continued depreciation; iii) The interest rate is Granger-caused by the exchange rate rather than the inflation rate, suggesting that de jure and de facto objectives of the TCB are divergent; and iv) The continued exchange rate depreciation alone is not enough to address the structural trade deficit. In light of these findings, we suggest that i) The transition from a discretionary MP to a rule-based inflation-targeting MP and with a well-defined role for the exchange rate, would help TCB gain credibility and improve efficiency of its MP; and ii) Tunisian policymakers should also consider consolidating MP in achieving its price stabilization objective particularly through implementing "supply-side policy" actions aiming at promoting economic growth and addressing unsustainable fiscal and external imbalances. [ABSTRACT FROM AUTHOR]

The growing development in the financial industry and the current high inflation rate are a great worry for investment prospects, especially mutual funds. Conventional mutual funds in Indonesia have experienced significant growth in the capital market. In the last 10 years, the number of domestic mutual funds has continued to increase. One measure of investment performance in mutual funds is proxied by the Net Asset Value (NAV) of mutual funds. Therefore, the objective of this study is to evaluate the influence of macroeconomics variables on the NAV of conventional mutual funds in Indonesia. In this study, using commercial bank data in Indonesia, we estimate an empirical model of the effect of inflation and exchange rates on the NAV of conventional mutual funds in Indonesia during the period 2012-2022. We employ a time series model using the Ordinary Least Square (OLS). The main findings show that while inflation has no effect on the NAV of conventional mutual funds, the exchange rate has a significant effect on it because there are many instruments in conventional mutual funds that have invested abroad due to changes in exchange rates that appear with dominant results that do not affect the growth of the NAV of conventional mutual funds. [ABSTRACT FROM AUTHOR]

As central banks struggle against high inflation in the aftermath of the Covid-19 pandemic and the war in the Ukraine, it is essential to understand the open economy aspects of inflation determination. Using a Bayesian VAR with time-varying parameters and stochastic volatility, we analyze the behavior of pass-through across time and in relation to macroeconomic variables. Pass-through increases with the size of the volatility of the exchange rate and the level, variance and persistence of shocks to domestic prices, which is in line with theory. The persistence of exchange rate shocks is associated with higher pass-through only for observations with low inflation. Furthermore, the effect of inflation persistence on pass-through is much higher for exchange rate appreciations than for depreciations. [ABSTRACT FROM AUTHOR]

The aim of this study is to assess the impact of GDP, currency exchange rates, and inflation rates, both separately and jointly, on the stock price of the mining companies included in the Jakarta Islamic Index in 2017 to 2022. The panel data analysis used in this study is a study approach, and uses E-Views 12. Estimate findings show that the stock price of the companies included in the Jakarta Islamic Index is significantly influenced by the exchange rate. The price of the index's mining business stocks was significantly affected by the rise in the dollar exchange rate. However, under certain circumstances, the rate of inflation studied is within a stable range, that is, below 10% per year, so the inflation rate is relatively ineffective. Although there is progress in real-sector investment, the limited influence of GDP may be due to the slow rise in investment in capital markets. As a result, the influence of GDP variables on the stock price of mining companies is only small. [ABSTRACT FROM AUTHOR]

We analyse how financial market analysts' expectations in the Czech National Bank's Financial Market Inflation Expectations survey perform relative to the random-walk forecast when it comes to predicting five financial variables. Using data from 2001 to 2022, our results indicate that the analysts are able to significantly outperform the random-walk forecast in terms of forecast precision for the repo rate and Prague Interbank Offered Rate at the one-month forecasting horizon. For the five- and ten-year interest rate swap rates, the random walk significantly outperforms the analysts at both the one-month and one-year forecasting horizons. For the CZK/EUR exchange rate, the random-walk forecast has a lower root mean squared forecast error than that of the analysts' forecast at the one-month horizon whereas at the one-year horizon the opposite is found; however, none of these differences are statistically significant. [ABSTRACT FROM AUTHOR]

This brief assesses the state of the Ukrainian economy two years since Russia’s full-scale invasion. After a devastating 2022, Ukraine’s economy in 2023 proved surprisingly resilient, thanks in part to its foreign partners. Decelerating inflation and a managed exchange rate provided macroeconomic stability, while re-secured shipping routes in the Black Sea improved Ukraine’s export performance. Despite these achievements, the problems of 2022 began to re-emerge in 2024 in Ukraine’s fight for survival. Besides the drying up of foreign funding and armaments supplies and the widening mismatch in labor force allocation, Ukraine requires more long-term, non-repayable assistance, greater support for returning Ukrainians, and reduced state pressure on private businesses. [ABSTRACT FROM AUTHOR]

The examination of inflation behavior in Nigeria, after the independence from British colonial rule, is a topical issue in light of the global inflation observed recently. The study investigates several possible explanations by focusing on the causal relationships between GDP per capita, inflation rate, money supply, and exchange rate in Nigeria. It employs annual time-series data from 1961 to 2020 and utilizes a vector autoregression Granger causality test technique. The results show that there is causality running from money supply to inflation rate, with no significant feedback effect. Other variables indicate no evidence of significant causal relationships. The study thus concludes that money supply is the most crucial factor influencing the inflation rate in Nigeria, with the recommendation that money supply should be effectively controlled to make the macroeconomy efficient. [ABSTRACT FROM AUTHOR]

The research is intended to determine factors affecting Investors at Pakistan Stock exchange, and for this purpose four macroeconomic variables; interest rate, inflation rate, exchange rate and FDI were selected as predictors and return of KSE 100 was included as a dependent variable. Meanwhile, the time frame of the study was from January 2001 to December 2015 and the frequency of the data was monthly. The preliminary testing and diagnostic analysis suggested towards Johansen Cointegration which further suggested VECM and Granger causality. Empirical findings of the study suggest that there are cointegration equations within the variables, implying that variables can be used to perform estimation and prediction of another variable. Meanwhile, VECM model reveals no significant effect of the macroeconomic variables on the stock market in long-run at lag 1; but at lag 2 interest rate and FDI shows a negative and significant effect on the KSE 100 returns. In addition to this, granger causality also shows no short-run bi-directional interrelation of macroeconomic variables with KSE 100 returns. Therefore, it is concluded that in Pakistan macroeconomic variables does not influence investor's behaviors and do not affect investing trend in KSE 100 index. Meanwhile, implications for policymakers, investors, regulatory authorities, government and for researcher have also been discussed in the paper. [ABSTRACT FROM AUTHOR]

The main objective of the research study is to analyze the determinants of inflation in the following countries; Pakistan, Bangladesh, and India. The research study utilized the data set from 1980 to 2022. For the purpose of empirical analysis, ARDL auto regressive distributed lag is employed. The findings indicate that in Pakistan Exports, Money-Supply, Exchange-rate and Oil Rents positively significantly influence the Inflation. While GDP has a negative significant influence on inflation. In India, Exports, Money-supply and Oil rents positively significantly affect the inflation. In Bangladesh there is significant relationship between GDP, Oil Rents and inflation. While exchange-rate has negative significant impact on inflation. It is suggested that all three countries to invest in renewable energy sources to reduce the dependency on oil imports. [ABSTRACT FROM AUTHOR]

Low and stable inflation and exchange rates are the main objectives of inflation-targeting monetary policy. The internal and external stabilities are prerequisites for promoting economic growth. Using a two-stage GARCH, we investigated the effect of inflation instability and exchange rate unpredictability on the economic growth uncertainty in the case of Indonesia over the period 2000(1)– 2022(12). It was evident that both inflation instability and exchange rate unpredictability hurt output growth. The impact of inflation instability was higher than that of exchange rate unpredictability. While the output growth was higher in the post inflation-targeting regime adoption, the effect of real exchange rate instability was greater than that of nominal exchange rate unpredictability. Those findings suggested that the monetary authority should strengthen their commitment to achieve the inflation target range. The sharper focus on the inflation stability might avoid the monetary authority conducting twofold targets of inflation and exchange rate stability to stimulate economic growth. [ABSTRACT FROM AUTHOR]

In any country, economic growth and the GDP are among the key most important indicators of progress as well as economic growth/development of that nation. Consequently, it is crucially significant to study and assess factors affecting the GDP. Therefore, the primary objective of this study is to investigate and analyze the impact of exchange rates and inflation on GDP. The objective of this article is to assess and analyze the impact of exchange rates and inflation on the GDPs of Iran, Iraq and Turkey during the period between 2005-2020. This research is descriptive in nature and applied in purpose. The relationships between the variables have been studied utilizing the data panel method compliant with statistical data from Iran, Iraq and Turkey (from 2005-2020). Data from the Central Bank of Iran, as well as the World Bank, were used for collect testing the hypotheses. Findings revealed that the exchange rate has no effect on GDP in these countries, while inflation has a significant/meaningful plus negative relationship with GDP. [ABSTRACT FROM AUTHOR]

This article examines the relationship between inflation and Iraq's currency supply. In order to better inform monetary policy, this research investigates the connection between money supply and inflation. The article aims to provide policymakers with a better understanding of the factors contributing to inflation in Iraq. This research incorporates an econometric analysis of data acquired from the Central Bank of Iraq and other sources. The data covers a period from 2011 to 2022. Inflation and money supply are the focus of the time series regression model shown here. Inflation in Iraq may be linked to the country's money supply, the results suggest. Rapid and immediate responses to changes in the money supply are characteristic of inflation. The research shows additional factors in Iraq's inflation besides government policies and currency rates. The results of this study provide substantial knowledge of the origins of Iraq's inflation. According to the results, regulating the money supply is essential for controlling inflation. The analysis also shows how important it is to have a broader view of inflation and its causes. This information helps build effective methods to stabilise the economy and sustain price stability in Iraq. [ABSTRACT FROM AUTHOR]

Using quarterly data for the 2002–2022 period, we estimate the output and inflation effects of several commodity prices (agricultural raw materials, crude oil, and metals) for 8 Eastern European countries with different exchange rate regimes. The Kalman filter is used for estimating the time-varying parameters. Our main findings can be summarized in the following way: (i) higher crude oil prices are inflationary in most of the countries (except Slovakia), with a stronger price effect since 2020; (ii) crude oil prices are neutral with respect to output growth in 4 out of 8 countries, with an expansionary effect in Croatia, Slovenia, and Romania, as well as a contractionary effect in Slovakia, but the crude oil shock of 2021–2022 seems to be expansionary in almost all countries (except Slovakia), regardless of the exchange rate regime practiced; (iii) inflation and output effects of metals prices are quite heterogeneous across countries; (iv) agricultural raw material prices play a role in both inflation and output growth only in Bulgaria and Poland. Since 2021, a growing inflationary impact of crude oil prices suggests a stronger monetary policy reaction to the oil shock, especially in the presence of its favorable output effect. [ABSTRACT FROM AUTHOR]

This paper examines the relationship between Mexican money demand and three economic factors: real income, inflation rate and exchange rate, and the relationship between exchange rate and money demand is the most concerned. Using the quarterly data of Mexico from 2000 to 2022, we explore whether the exchange rate will symmetrically affect the demand for money in the short and long term. The results show that in the long run, the impact of real income and inflation rate on money demand is the same as the conjecture, both are positive. However, the present paper does not find an asymmetric effect of the exchange rate, possibly due to the lack of research data or the short time span. [ABSTRACT FROM AUTHOR]

Import flows are one of the major economic variables that play a significant role in global trade and determine a country’s economy’s performance. The current article imperially scrutinizes the symmetric relationship between energy electricity supply, inflation rate, exchange rate and import flows in South Africa. This objective was achieved through the application of econometric models such as ARDL, ECM and T-Y approaches. These approaches were applied on monthly time series from January 2002 to October 2022. The results indicated the presence of long-run and short-run import flows behaviour electricity supply, inflation and exchange rate volatility. While the inflation rate and electricity supply positively influence long-run import flows, the latter is negatively influenced by exchange rate volatility. To improve import flows in South Africa, the study recommends policymakers’ caution in selecting the country’s adequate exchange rate regime and considering electricity supply and inflation rate while establishing the country’s terms of trade. [ABSTRACT FROM AUTHOR]

Copyright of International Journal of Economics, Business & Politics (UEIP) is the property of International Journal of Economics, Business & Politics and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of International Journal of Economics, Business & Politics (UEIP) is the property of International Journal of Economics, Business & Politics and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Purpose This study examines the influence of macroeconomic variables on stock market performance in Indonesia and Japan from 2013 to 2023. Drawing upon the Efficient Market Hypothesis (EMH), we investigate how key factors such as interest rates, inflation, exchange rates, and economic events impact stock returns. Design/methodology/approach We examine the connections between these characteristics and stock market performance in two different markets using regression analysis and EMH as the theoretical framework. In order to find patterns and trends, we analyse data spanning a decade. Findings Interest rates strongly affect Indonesian stocks due to their influence on investor sentiment. In Japan, trade agreements have a significant positive impact on stock returns. However, stock returns in both countries are weakly connected to inflation, currency rates, and other economic and political factors. The global economy remains a key external factor for both markets. Research limitations/implications This study has some restrictions, such as data limitations and EMH framework-related presumptions. In the future, research may focus on longer-term effects, behavioural aspects, and sector-specific analysis to further our comprehension of these intricate interactions. Originality/value This research advances our understanding of market behaviour under various economic conditions by analysing the interaction of macroeconomic variables and stock market dynamics in two distinct economies. [ABSTRACT FROM AUTHOR]

This paper investigates the properties of the change in persistence detection for observations with infinite variance. The innovations are assumed to be in the domain of attraction of a stable law with index κ ∈ (0 , 2 ] . We provide a new test statistic and show that its asymptotic distribution under the null hypothesis of non-stationary I (1) series is a functional of a stable process. When the change point in persistence is not known, the consistency is always given under the alternative, either from stationary I (0) to non-stationary I (1) or vice versa. The proposed tests can be used to identify the direction of change and do not over-reject against constant I (0) series, even in relatively small samples. Furthermore, we also consider the change point estimator which is consistent and the asymptotic behavior of the test statistic in the case of near-integrated time series. A block bootstrap method is suggested to determine critical values because the null asymptotic distribution contains the unknown tail index, which results in critical values depending on it. The simulation study demonstrates that the block bootstrap-based test is robust against change in persistence for heavy-tailed series with infinite variance. Finally, we apply our methods to the two series of the US inflation rate and USD/CNY exchange rate, and find significant evidence for persistence changes, respectively, from I (0) to I (1) and from I (1) to I (0) . [ABSTRACT FROM AUTHOR]

This article aims to investigate the behavior of exchange rate in the BRICS countries, with an emphasis on exchange rate passthrough and exchange rate determination empirical models. By applying the ARDL Bounds Testing Approach Methodology, from January 2005 to December 2019. Our main results show that: i) there is a long run cointegration among the variables analyzed for all estimated models; ii) there is a very slow speed of adjustment towards the long run equilibrium; iii) there is evidence of exchange rate passthrough to inflation mainly in the long run, but not as strong as before; iv) there is no evidence of exchange rate overshooting; v) international reserve accumulation can be considered a partial explanation for the evidence of no exchange rate overshooting. [ABSTRACT FROM AUTHOR]

The primary objective of this study is to examine the causal relationships among exchange rates, economic growth, and inflation in Indonesia. The data used in this research is secondary data with time series data for the period 2000 to 2019, obtained from the Bank Indonesia, Indonesia Central Bureau of Statistics, and World Bank. The method used in this research is Granger Causality. The outcomes of the analysis reveal a bidirectional causal relationship between economic growth and the exchange rate in the short term, as well as between inflation and the exchange rate. An appreciation of a country's exchange rate of one percent has an impact on changes in the overall price of goods, while an increase in the inflation rate causes a depreciation of the exchange rate. The relationship between inflation and economic growth shows that there is a one-way causal relationship, namely that inflation affects economic growth but not vice versa. These findings have significant policy implications, indicating that the Indonesian government needs to prioritize efforts to control inflation to support sustainable economic growth. Therefore, it is necessary to implement appropriate monetary and fiscal policies to maintain price stability and encourage balanced economic growth in Indonesia. [ABSTRACT FROM AUTHOR]

This paper augments the sparse literature on the inflationary impact of foreign debt in Brazil while addressing methodological caveats in previous studies. We depart from the linearity assumption and employ two nonlinear techniques: the nonlinear autoregressive distributed lag (NARDL) model and a Markov Switching Regression (MSR) to investigate the connection between foreign debt and inflation within a multivariate framework. The analyses consider the presence of structural breaks via assessing variable stationarity using the Zivot and Andrew unit root test and incorporating a residual-based cointegration test proposed by Gregory and Hansen. Additionally, we apply a multiple structural breakpoints test by Bai and Perron to determine the presence of structural breaks in the impact of foreign debt on inflation. Our findings robustly indicate that the domestic money supply has a statistically significant positive effect, while the nominal effective exchange rate has a negative effect on inflation in both the short and long run. The NARDL model reveals that only positive changes in foreign debt have a statistically significant negative effect on inflation in the short run, whereas both positive and negative foreign debt changes significantly affect inflation in the long run. The results from the MSR model are generally consistent with those of the NARDL model. [ABSTRACT FROM AUTHOR]

Developing nations have the task of effectively managing their external debt. The government is urged to comprehend the decisive component in managing its external debt, despite the varying viewpoints among economists. In addition, the world sees the need for institutional quality to optimize its economic policy. Institutional quality shows accountability, stability, effectiveness, quality, law, and trust. Our research examines the determinant factors of external debt and discusses the policy to manage external debt. We regress the inflation rate, exchange rate, interest rate, trade openness, and institutional quality on external debt. This study also uses moderated regression analysis to examine the interaction between institutional quality and macroeconomic indicators on external debt. We selected 52 samples from five ASEAN developing countries from 2008 to 2019. The first study found that the inflation rate, interest rate, and institutional quality have a negative impact on external debt, while the exchange rate and trade openness have a positive impact on external debt. Next, we were surprised that institutional quality could not moderate the relationship between the inflation rate, exchange rate, and interest rate on external debt. Further, it only moderated the relationship between trade openness and external debt. In the end, we discuss the external debt determinants from the selected ASEAN developing countries with the theories. [ABSTRACT FROM AUTHOR]

The main purpose of this study is to determine the presence and timing of the structural breaks in the stock market returns and investigate their impact on the relationship between the macroeconomic variables (namely the inflation rate, the exchange rate, the oil prices) and the stock market returns of a sample of Arab countries facing political and economic instability, namely (Syria, Egypt, Tunisia and Bahrain), during the period (2010-2020). CUSUM test is performed in order to test the presence of structural breaks in stock market indexes. In case there is evidence of structural breaks, Bai and Perron Multiple Breakpoints test is used to identify points in time where significant changes may have occurred. The timing of structural breaks is used as a control variable to examine the impact of the macroeconomic variables on the stock market returns through applying Johansen cointegration test. The results provide evidence of the presence and timing of the structural breaks in the Arab stock markets under study and their role in impacting the relationship between the macroeconomic variables and stock market returns. The study concluded that the dynamics of how the macroeconomic variables affecting the stock market returns depends on the nature and timing of the structural break. [ABSTRACT FROM AUTHOR]

Purpose -- This study aims to investigate the influence of macroeconomic factors, including economic growth, inflation, the rupiah exchange rate, and interest rates, as well as corporate financial performance indicators such as leverage and profitability, on the stock returns of Indonesian Property and Real Estate Sub-Sector companies. Method -- The research data consists of annual data obtained from the Indonesia Stock Exchange, the Indonesia Central Bureau of Statistics, and Bank Indonesia for the period from 2017 to 2021. The research population comprises 36 Property and Real Estate companies listed on the Indonesia Stock Exchange. Out of these, 28 companies meet the sample requirements. The analysis employs panel data regression to examine the data. Result -- The results indicate that inflation and exchange rates have a negative and statistically significant impact on stock returns. On the other hand, economic growth, interest rates, return on equity, and the debt-to-equity ratio exhibit a positive influence on stock returns, although these effects are not statistically significant. Contribution -- This study's distinctive contribution is its focused analysis of the Property and Real Estate Sub-Sector in Indonesia. It stands out by exploring the intricate relationship between macroeconomic factors and financial performance variables concerning the stock returns of companies within this sub-sector. This nuanced approach provides valuable insights into a specific industry within the Indonesian market, shedding light on previously unexplored dynamics and contributing to a deeper understanding of how these factors affect stock returns in this context. [ABSTRACT FROM AUTHOR]

The interest rate was and still a point of difference between economists. This difference is based on a difference in understanding the nature of the market in which the interest rate is determined and in enumerating the influencing factors in this market. Interest rate has a role to play in the national economy, but this role differs from one country to another due to different economic and political conditions. This study sheds light on the impact of changes of the US interest rate, the inflation rate and the exchange rate on the domestic interest rate in five emerging economies (Brazil, Russia, Turkey, China, and South Africa). The experimental results of the study were estimated by the dynamic least squares method and the causality test using monthly data during the period 2011-2019. The study concluded that the US interest rate has an inverse relationship with the interest rates of all sample countries included in the study at a significant level (5%). The increase in inflation and fluctuations in the exchange rate contributed to raising interest rates in the sample country. The results of causality test also indicated that the inflation rate and the exchange rate cause interest rates in Brazil, Turkey and South Africa in the long term. [ABSTRACT FROM AUTHOR]

This paper aims at empirical assessment of monetary policy relationships in Central and Eastern European countries (Czechia, Hungary, Poland, Romania), which practise the monetary regime of inflation targeting. Using quarterly data for the period of 2004-2019, the authors examined the relationship between the output gap, nominal and real exchange rate misalignment, consumer price inflation and the central bank policy rate, using the panel vector autoregression (PVAR) model. According to estimates, the central banks of the CEE-4 countries react with an increase of their policy rate to the output gap and inflation, as implied by the Taylor rule. At the same time, a monetary reaction to nominal (real) exchange rate misalignment is lost in the estimates for the post-crisis period of 2010-2019. An increase of the central bank rates does not seem to have unfavourable output effects, while the nominal exchange rate is likely to depreciate with three to five quarter lags. However, there is evidence of the price puzzle when monetary tightening is followed by a counterintuitive increase in the inflation rate. In full accordance with the New Keynesian framework, inflation depends on the output gap, while being expansionary in the real sector. Evidence of the exchange rate pass-through (ERPT) to inflation is mixed. This article provides insights into the average monetary policy reaction function and its macroeconomic effects in the CEE-4 countries, with the value added in that following the Taylor rule does not guarantee effectiveness in tackling inflation in the presence of the price puzzle. Based on the estimated exchange rate effects on the output gap and inflation, deliberate currency appreciation resulting from the central bank foreign exchange interventions and/or fiscal austerity measures can be helpful for such a disinflation that minimises output losses. [ABSTRACT FROM AUTHOR]

Using a backward‐looking Philips curve framework and a Logistic Smooth Transition Regression (STR) model, this article examined the exchange rate pass‐through (ERPT) to final consumer prices in the case of India. Specifically, the nonlinearity of ERPT has been investigated with respect to the level of economic activity and the rate of inflation by considering two alternative measures of exchange rate. For the first transition variable, results are markedly different between high and low‐activity regimes and signify the favourable impact of economic activity on the extent of pass‐through. In the short run, 1% exchange rate appreciation would decrease the price level by 0.244% when the economy is in a low‐activity regime; however, the same appreciation increases the price level by 0.485% when there is a boom in the economy. In the long run, ERPT in the low‐activity regime is −0.358, and in the high‐activity regime, it is 0.039. In both regimes, pass‐through coefficients differ from zero and one, implying that neither local currency pricing nor producer currency pricing characterizes the ERPT mechanism. The impact of other important determinants of inflation is also well according to theoretical expectations. Finally, for the rate of inflation, we did not report any evidence favouring the Taylor hypothesis in the case of India. [ABSTRACT FROM AUTHOR]

Not that different. Based on a unique dataset of semi‐annual microeconomic price levels of goods and services across and within countries for 1990:1–2018:2, we show that time‐series volatility and cross‐sectional dispersion of law‐of‐one‐price deviations are similar for pairs of cities within the same country and across the Eurozone eleven original members. Our empirical analysis reveals that inflation and nominal exchange rate volatility/dispersion across locations have a positive impact on the volatility/dispersion across locations of law‐of‐one‐price deviations across the globe. Furthermore, dispersion of law‐of‐one‐price deviations across goods falls when the relative inflation rate between these locations rises, suggesting that the degree of price adjustment in individual product markets within a country has an international component shaped by international trade and arbitrage considerations. According to this measure of price integration, economies within the monetary union are half‐way to the level of integration characterizing national economies. Moreover, monetary union membership is associated with lower volatility of law‐of‐one‐price deviations, placing member countries more than half‐way towards the volatility levels characterizing national economies. [ABSTRACT FROM AUTHOR]

• We explore the role of monetary, fiscal and income policies in the face of exogenous inflationary shocks in an empirical stock-flow consistent model while using Denmark as a case study. • We find that a contractionary monetary policy can lead to a modest reduction in inflation at the cost of further contracting the economy. • We find that a close coordination of fiscal and income policies can help reduce the effects of adverse shocks to income without increasing inflation. • We explore the dynamics of public debt, find that of all the policies implemented, monetary policy has the most dramatic effects on public debt sustainability. This paper provides an assessment of the different channels through which monetary, fiscal and income policies affect prices and output in a small open economy and discuss which policy measures are effective and feasible in the face of inflationary shocks. We build a stock-flow-consistent model using sectoral data for Denmark. We then replicate the inflationary environment faced by Denmark and several other countries after the Covid-19 crisis. While taking monetary tightening as a forced policy response for a small open economy with fixed exchange rate, we explore a number of policies that, within the current institutional and legal framework, can potentially mitigate the effects of inflation. Our conclusion is that a close coordination of fiscal and income policies can help reduce the effects of adverse shocks to income without increasing inflation. Furthermore, we find that of all the policies implemented, monetary policy has the most dramatic effects on public debt sustainability. [ABSTRACT FROM AUTHOR]

India is among the largest and fastest-growing economies in the world. To continue its growth, energy is and will continue to be one of its most important considerations. With a population of over one billion, India is the third largest consumer of petroleum on the globe. To maintain this ranking, India imports a large percentage of its total oil consumption. Given India's current position as a large importer of oil, how does oil price volatility affect the Indian economy? This paper examines the effect of oil price volatility on inflation, economic growth, and the stock market in India. Statistical tests suggest that the overall price level, the real effective exchange rate, and oil prices are negatively related to aggregate output in the long run. Granger causality test results derived from a vector error correction model support bidirectional causality between oil prices and aggregate output, indicating that a change in oil prices also affects aggregate output in the short run. [ABSTRACT FROM AUTHOR]