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This research is to now the determinant of DER and the implication toward YTM and Economic growth in Banking Sector on The Indonesian Stock Exchange. The research sample is 22 Bond Series which are banking companies listed on the Indonesia Stock Exchange for the 2019-2023 period. Methods of data analysis using panel data regression method. The empirical results of the first model show that Profitability (ROA), Firm Size (SIZE), and Interest Rate (IR) have a positive effect on Capital Structure (DER), while the Exchange Rate (FOREX) has a negative effect. Liquidity (CR) has no effect on DER. All independent variables consisting of; ROA, CR, SIZE, FOREX and IR together significantly influence DER. The goodness-of-fit test as measured by the termination coefficient (R2) shows a coefficient of 0.937202, meaning that the variation in the ups and downs of the DER can be explained by ROA, CR, SIZE, FOREX, and IR of 93.72 percent, while the rest, namely 6.28 percent can be explained by other variables not examined in this research model. For the adjusted coefficient of determination (R2 adjusted) the coefficient is 0.9217. The second model shows that the DER and IR variables have a negative effect on Yield to Maturity (YTM), while the SIZE and FOREX variables have a positive effect. ROA and CR variables have no effect on YTM. All variables DER, ROA, CR, SIZE, IR and FOREX together affect YTM. For the goodness-of-fit test as measured by the termination coefficient (R2) shows a coefficient of 0.6750, which means that the variation in changes in the rise and fall of YTM can be explained by; DER, ROA, CR, SIZE, IR, and FOREX are 63.30 percent, while the remaining 36.70 percent can be explained by other variables outside this research model. [ABSTRACT FROM AUTHOR]

This study explores the correlation between economic growth and financial stability among upper-middle-income countries in APEC, such as Indonesia, China, Malaysia, Mexico, Peru, Russia, and Thailand from 2013 to 2023. It employs a simultaneous equation approach. The motivation for this research lies in securing the well-being of future generations, as effectively managing current economic growth and financial stability will foster investment in future welfare. This lays the groundwork for sustainable and inclusive economic progress over time. Key findings indicate a mutually beneficial relationship between financial stability and economic growth. The study underscores the importance of bolstering financial stability through measures like increasing capital adequacy ratios and credit private sector, while also managing credit card usage and interest rates. Moreover, it suggests that fostering economic growth requires enhancing credit private sector, alongside managing interest rates, unemployment, and poverty. The study recommends that governments of upper-middleincome APEC countries implement macroprudential policies effectively. This strategic approach aims to uphold both financial stability and interconnected economic growth, thereby mitigating systemic risks that could otherwise harm the economy. [ABSTRACT FROM AUTHOR]

AbstractIrving Fisher and Frank Knight had a brief exchange on the former’s “The Theory of Interest”, published in 1930, which culminated in a full book review by Knight in 1931. We assess the episode by recasting Fisher’s interest theory as a maximisation under constraint calculation. After that, Knight’s objections to subjective time preference are examined, as well as his ensuing attack on the Austrian School’s definition of capital. Fisher’s and Knight’s reflections on business cycles, grounded on expectations, delays, and speculation, are assessed in sequence. We conclude by indicating some limitations of the theories of interest formulated by both economists. [ABSTRACT FROM AUTHOR]

This study aims to analyze the impact of the Domestic Investment program (PMDN), Bank Indonesia interest rate (BI Rate), and exchange rate on the Jakarta Composite Index (JCI) in Indonesia. To test the relationship between the independent variable (PMDN, BI Rate, and exchange rate) and the dependent variable (JCI) over a certain period of time, multiple regression analysis method is used. This research uses data obtained from various reliable and relevant sources. The findings of this study are expected to provide a deeper understanding of the factors that influence JCI in Indonesia and provide insight for policymakers to improve the investment climate. The conclusions and policy recommendations generated from this study are expected to be able to make a positive contribution to Indonesia's economic development in the long term. [ABSTRACT FROM AUTHOR]

Fama's "proxy" hypothesis and Liquidity Preference Theory suggest that there is an inverse relationship between interest and inflation rates and stock prices/returns. On the other hand, according to the Fisher hypothesis suggests that there is a positive interaction between the stock market returns and inflation rate. The increase in the interest rate, on the one hand, due to the increase in the discount rate and, on the other hand, due to the alternative cost of investment, reduces the interest towards the stock market and increases the tendency towards the bond market, causing share prices to fall. However, it is seen that the relationships in question are far from certain, and the findings obtained from different samples with different methods give results that do not match the expectations implied by the hypotheses. The nexus between the stock market and interest and inflation rates in Türkiye, which has been faced with high interest rates and inflation for many years except short-term periods, has been examined using different time series methods in the empirical literature. In this study, the subject is investigated in a different way through the Quantile Regression (QR) method. In the study, where the effect of the nominal interest rate on stock prices was examined by dividing it into two components: real interest and inflation rates, a four-fold sub-sector distinction was made, namely service, financial, industrial and technology indices. When it comes to the effect of nominal and real interest rates on returns in QR estimates, it is seen that the service and industrial sectors differ in terms of both tail and sign. The similarities between Least Squares estimates and QR estimates are striking. However, the potential of the volatility level of variables to create differentiation in relationships is also a point that should not be overlooked. [ABSTRACT FROM AUTHOR]

This research study examined the accessibility of credit for small and medium-sized enterprises (SMEs) in Osun State, Nigeria. More specifically, the study examined the factors that impact SMEs' credit accessibility and determined the degree to which government institutional funds and credit schemes have influenced SMEs' credit accessibility in Osun State. The study utilized a descriptive survey research design, randomly selecting 238 SMEs and collecting data through a structured questionnaire. The data was analyzed using both descriptive statistics and a logit regression model. The results demonstrate that small and medium-sized businesses in the research area can more easily obtain financing attributable to government institutional funds. The survey also showed that excessive levels of documentation and bank interest rates had a major detrimental impact on small and medium-sized businesses' ability to obtain funding. Therefore, the study suggests that policy measures be implemented by the government to control the interest rate that banks charge on loans to small and medium-sized enterprises. Second, proactive steps must be taken by the government, financial institutions, and other stakeholders to make credit more accessible to SMEs. [ABSTRACT FROM AUTHOR]

The performance of the small and medium-scale enterprises is a function of internal and external factors, which are challenges for the enterprises to consider in their internal operations that spur the contribution to economic development. The inability to align with financial technology and the availability of bank intermediation prowess could retard their supposed contribution to economic development due to poor levels of performance. In the peculiarity of these challenges, this study examines the combined effect of financial technology and bank intermediation on small and medium-scale enterprises' performance. The study adopted time series data from the Central Bank Statistical Bulletin from 2019 to 2022 but was converted to quarterly data to accommodate the ordinary square least regression. The findings from the short-run results in accordance with the bound test revealed that point-of-sale, loan-to-deposit ratio, liquidity ratio, and interest rate have a positive significant effect on credit for small and medium-scale enterprises, while automated teller machines and deposit mobilization have a negative significant effect on credit for small and medium-scale enterprises. It is therefore recommended that financial institutions also reconsider their reliance on ATMs in SME operations, as it has a substantial negative impact. Encouraging web-based payment systems could also be beneficial, though further studies are needed to assess their full potential. Strengthening financial indicators like loan-to-deposit ratios and liquidity ratios should be prioritized to enhance credit provision. Additionally, financial institutions should explore alternative deposit mobilization strategies that do not constrain credit flow to SMEs. Keywords: Financial Technology; Bank Intermediation; SME’s Performance; Interest Rate

Monetary policy has an impact on CO2 emissions which is not entirely understood in the literature. Whereas there is a consensus that the impact is indirect through investments, the literature does not investigate the impact of monetary policy on (green) investments. Additionally, we argue in this paper that monetary policy can have a different impact on ‘green’ investments and ‘brown’ investments. This paper focuses, therefore, on the impact of monetary policy on investments. In particular, this paper empirically investigates whether the real interest rate has a different effect on green investment, compared to general investment, using quarterly data from the United States between 2004 and 2020. The results from the autoregressive distributed lag model show that the real interest rate is negatively related to the ratio of green investment relative to total investment. This result emphasizes the importance of the green investment effect channel and suggests that monetary policy has an unintentional role in climate policy which should be considered by policy makers.

Research Purposes. Objective of study is examining market efficiency in Indonesia under high interest rates issue. Research Methods. Observation period on Indonesia stock composite index starts from June 7, 2023 to February 29, 2024. Several procedures are applied in objective of hypothesis testing, which are: (1) mean difference test supported by Cohen's test and normality test by Anderson-Darling in terms of detecting how market returns differ in the two observation periods; (2) runs test runs test in terms of detecting the randomness of market returns after the risk-free rate; (3) ARIMA is supported by the Augmented Dickey-Fuller test in terms of detecting whether randomness is just noise (or white noise); and (4) variance ratio test in terms of confirming the results of runs test and ARIMA to determine whether the market returns are efficient or just a noise. Research Results and Findings. Consistent with efficient market hypothesis, findings show that the market condition during the effective interest rate period of 6% has higher returns, riskier, better risk-return trade-off, and less efficient. During that period, noise seemed to play a role in creating market gaps. This study concludes that monetary policy in maintaining high effective interest rates cannot determine whether the market is more efficient. As implication, the high effective interest rate tends not to result in a shift in investor behavior to allocate stock investments to risk-free assets. This study contributes to develop the finance and accounting science, especially in the fair presentation of financial information including investment decisions.

In this research paper, we have studied the ways applying for making deposit in Nepalese commercial banks and fund mobilization behaviour shown by them to generate income for paying interest on deposit to customers. Documentation and institutionalization of deposit for the purpose of making investment into productive sectors are considered as good practices of income generation and economic development of people.

This study aims to determine the money supply, interest rates and exchange rates against inflation. This research data uses secondary data with the time series method obtained from the North Maluku Bank Indonesia (BI) and North Maluku Central Statistics Agency (BPS) from 2010-2020. The method used in this research is multiple linear regression. Based on the results of the study showed that the simultaneous testing showed that of the three variables, there was no effect. Based on the above findings that inflation is mostly influenced by interest rates, if interest rates rise it will increase inflation. Because interest rates have the most dominant contribution in increasing inflation, therefore the monetary authority must try to maintain interest rates for inflation stability.

Resolving problems resulting from stagflation conditions accompanied with low economic growth and slow employment growth needs some policies that one of them can be unconventional monetary policy. Thus, this paper proposes to evaluate the effects of unconventional monetary policy shocks using VAR with a new method called sign restrictions. To this aim, it were estimated the effects of three variables ordered as real interest rate, inflation and gross domestic product by imposing positive and negative restrictions on these variables for the period 1961-2021. In this paper, the results of model estimation and impulse response functions is done by identifying and estimating parameters on the basis of imposing negative sign on interest rate according to unconventional monetary policy shocks. Results indicate that decreasing in interest rate causes increasing in GDP. Unconventional monetary policy can raise liquidity in stock market. It also support people by low interest rate loans for production with less cost and less sale price in Iran. Therefore, unconventional monetary policy can be a useful policy for resolving stagflation occurred current years in Iran.Extended Abstract:IntroductionThe global financial crisis(GFC) marked the transition from what many had labelled the period of “Great Moderation” to that of the “Great Recession”. The stress experienced by the financial sector starting in the summer of 2007 put an end to several years of robust growth for the world economy accompanied by moderate inflation rates across most advanced market economies. Across a number of countries, financial intermediation halted, with the peak of the stress manifesting in the final quarter of 2008. Unemployment increased and inflation dropped below central banks’ target levels as economic activity receded sharply. The recovery from the deep recession was also slow in many jurisdictions, with tepid economic growth, sluggish employment growth and subdued inflation. The challenges posed to monetary policy during this period were severe and pushed central banks to resort to actions departing from their established policy frameworks.The set of policy interventions introduced during this period has been labelled as unconventional monetary policy in order to distinguish it from the conventional pre-GFC policy measures. Some unconventional monetary policies were designed to affect term spreads such as long-term risk-free rates, while others were directed at influencing liquidity and credit spreads such as interest rates on various non-risk-free instruments. One of the most important tools in unconventional monetary policy is negative interest rate policy (NIRP). The adoption of negative policy interest rates in the aftermath of the GFC was new. Identification of shocks is one of the most important issues in econometrics for interpreting their impact on themselves and also other variables. Therefore, in case of unconventional monetary policy, VAR model is applied for identifying shocks. In the research, it was identified different shocks using sign-restriction approach in Iran for the period 1961-2021.

In the global financial landscape, a transformational shift towards digitization is known, and a comparative analysis of two key components is of particular relevance: central bank digital currency (CBDC) and quantum financial system (QFS). This article explores the dynamic relationship between traditional monetary instruments and new digital currencies, considering the transformative impact and regional nuances of CBDC. The article provides a historical overview of the evolution of the development and implementation of CBDC in the world, analyzes the key factors affecting its implementation in different regions, identifies key technological advances that are the disruptive force of QFS, as well as their impact on the transformation of traditional financial transactions. In the context of the development of CBDC and QFS, the legal frameworks that regulate their work, facilitate or hinder their broad integration into existing financial systems, their impact on traditional monetary policy and, accordingly, on economic stability, inflation and interest rates, and the format of the technological infrastructure are determined, which must be ensured for their successful implementation and operation, as well as the main challenges related to this and ways to solve security and privacy problems in their application. The paper combines qualitative and quantitative analysis to provide a comprehensive and validated dataset for a thorough understanding of digital financial paradigms. Qualitative research was conducted based on structured interviews with experts in the development and implementation of CBDC and QFS, as well as reporting and analytical information on central banks, regulators, and other financial institutions. The empirical study is based on the built OLS model, which describes the dependence coefficient using CBDC (the share of the population that uses it) on the traditional interest rate set by the central bank (taking into account the corrections for the possibility of variation of its changes and unobservable factors). The Python programming language with R libraries and the Stata software package are used for modeling. Tests confirmed the model's statistical significance and high R-squared value (0.756 ) to begin its ability to explain a significant portion of the variability in CBDC adoption rates. The results showed that, on average, per skin unit increase in the traditional interest rate, post-CBDC rate growth is expected to be 1.74%; when the conventional interest rate is zero, the settlement rate after CBDC is 11.14%. The results of this study can be used to predict the dynamics of public perception of digital currencies. In addition, central banks can adjust interest rates to stimulate or moderate the adoption of CBDCs based on broader strategic macroeconomic measures: 1) during economic downturns, higher interest rates can be used to stimulate the adoption of digital currencies as an alternative financial instrument; 2) during periods of economic growth, interest rates may be lowered to mitigate the intended overheating of CBDC adoption.

Bu çalışmada özellikle gelişmekte olan ülkelerin iç ve dış denge amaçları açısından son derece önemli olan finansal dışa açıklık ve faiz oranının döviz kuru oynaklığı üzerindeki etkileri araştırma konusu yapılmıştır. Bu amaçla çalışmada; Türkiye için finansal açıklık, faiz oranları ve EGARCH yöntemi ile tespit edilen döviz kuru oynaklığına ilişkin 2002Q1-2023Q1 dönemine ait çeyreklik veriler kullanılmıştır. Çalışmada, geleneksel ADF birim kök testinin yanı sıra yeni nesil zaman serisi analizleri olan F-Kruse birim kök ve Fourier-Shin eş-bütünleşme testleri kullanılmıştır. Ayrıca uzun dönem katsayısı belirlemek için DOLS modeli tahmin edilmiştir. Yapılan analizlerin sonuçları, Türkiye’de döviz kuru oynaklığı üzerinde finansal dışa açıklıktaki ve faiz oranlarındaki artışın sırasıyla negatif ve pozitif etkileri olduğunu göstermektedir. Söz konusu bulgular, Türkiye’nin dış borçlanmaya ihtiyacı olan bir ülke konumunda olduğuna, faizlerin yanı sıra finansal istikrara da önem verilmesi gerektiğine işaret etmektedir.

Until recent years, the performance of the Nigeria’s manufacturing sector has been characterized by downward pressures. Given the present shocks in the global energy markets and upward review of borrowing costs by the Central Bank of Nigeria, the historical developments around the manufacturing output appear to be subject to renewal. Consequently, this study investigates the impact of interest rate structure and energy pricing on the Nigerian manufacturing output from 1980 to 2021. Secondary data obtained from World Development Indicators and the CBN’s Statistical Bulletins were anchored by an autoregressive distributed lag (ARDL) model and error correction modelling. The findings revealed that manufacturing output is inelastic in its response to changes in interest rate while it is elastic in its response to energy price. This is less puzzling as the Nigerian manufacturers seem to favour availability of credit facilities over low interest rates. Also, productive activities respond immediately to a given shock in the energy price, especially the price of diesel. On this basis, this paper concludes that energy pricing is a strong predictor of Nigeria’s manufacturing output. Consequently, policy makers should institute a preferential treatment on energy distribution towards the manufacturers. This would make production more attractive, thereby boosting their capacity utilization.

Bu çalışmanın amacı Türkiye için pay senedi piyasaları ve makroekonomik değişkenler arasındaki ilişkileri incelemektir. Bu amaçla çalışmada Borsa İstanbul 100 endeksi (BIST100), tüketici fiyat endeksi (TUFE), politika faiz oranı ve döviz kuru (Dolar/TL) değişkenleri, Ocak 2000 – Ekim 2023 dönemi için aylık frekansta ele alınmıştır. Çalışmada değişkenler arasındaki ilişkileri zaman serisi yöntemleri ile incelemek için Toda - Yamamoto ve Fourier Toda-Yamamoto nedensellik testleri kullanılmıştır. Sonuçlar Türkiye’de politika faizinden pay senedi piyasalarına tek yönlü nedensellik ilişkisi, TUFE ve Dolar/TL arasında çift yönlü nedensellik ilişkisi ve BIST100’den Dolar/TL’ye tek yönlü nedensellik ilişkisi olduğunu göstermektedir. Politika faiz oranı ve Dolar/TL döviz kuru ile TUFE ve BIST100 arasından nedensellik ilişkisi bulunamamıştır. Hem TY hem de FTY nedensellik analizinden elde edilen bulguların paralel olması seçili değişkenlerin Fourier eğilimlere sahip olduğunu kanıtlamaktadır. Buradan hareketle politika faiz oranındaki bir değişim BIST100’ü etkilemekte iken BIST100’deki bir değişim Dolar/TL’yi etkilemektedir. Bu bulgular yatırımcılar, politika yapıcılar ve araştırmacılar için yeni bilgiler sağlamaktadır.

Abstract The core objective of this article is to explore the viability of uncovered interest parity and to reconnoiter major determinants of domestic interest rates of the Pakistan and China economies. It is imperative to study the interest rate parity that assistances to comprehend that exactly how exchange rate and domestic interest rate influence foreign interest rate of two economies in emerging trends in international trade. The World Development Indicators is main source of data gathering, and it ranges from 1980 to 2023 for the analysis of both models. This study considers two models, Engle–Granger causality has been applied in Model 1, to analyze the uncovered interest parity, and findings indicate that the exchange rate of each country has no effect on the interest rate of the other country. However, Model 2 investigates the main determinants of domestic interest rate and their long-run associations for Pakistan and China. To capture the long-run association, ARDL estimation technique has been deployed, and findings show the long-run relations and co-integration among the policy variables of both countries. In Pakistan, consumer price index and exchange rate hold positive linking with the domestic interest rate; however, output level is adversely correlated. The error correction term is 91%, confirming the rapidity of equilibrium adjustment when a shock occurs. Regarding the Chinese economy, consumer price index and exchange rate have a negative impact on China domestic interest rate. The results of the error correction model indicate an 80% speed of convergence in the long run. This study suggests that improvement in productivity and exchange rate may assist both economies to experience steady exchange rate and interest rate.

The performance of a stock market is intrinsically linked to the broader financial and economic landscape of a country. Stock prices, as integral indicators, not only mirror the financial health and collective economic circumstances of a nation but also serve as crucial barometers of tangible financial activities. This research paper aims to undertake a comprehensive exploration of the intricate relationship between specific macroeconomic determinants and the stock market within the context of India. Moreover, this study conducts an exhaustive analysis to assess the relative significance of these variables and their contributions to the predictive capacity of stock prices. This investigation harnesses a dataset consisting of monthly observations of the chosen macroeconomic variables. The outcomes of the cointegration analysis illuminate a robust and statistically significant long-term association between Indian stock prices and the selected macroeconomic factors. The results of the cointegration test affirm a lasting nexus between stock returns and crucial economic indicators, namely Gross Domestic Product (GDP), disposable income, and the participation of Foreign Institutional Investors (FII) in the market. Furthermore, this study underscores the enduring negative relationship between stock returns and factors, such as interest rates, government policies, exchange rates, and inflation. These findings provide valuable insights into the interplay between the stock market and macroeconomic forces in the Indian context.

AbstractThe performance of bank stocks exhibits a country’s overall financial health and signals economic growth. Therefore, understanding the interaction of macroeconomic factors on bank stock returns is crucial for the valuation of financial assets, especially in a highly volatile stock market. Although macroeconomic factors and their impact on bank stock returns have been extensively investigated, there is still a dearth of comprehensive review articles in this domain. To address this lacuna, we conducted a systematic review to identify the macroeconomic determinants driving bank stock returns. Through a systematic search, 64 articles were identified from two electronic databases for literature synthesis based on inclusion and exclusion criteria from 1980–2023. The review posits valuable insights into the macroeconomic factors that influence bank stock returns, the nuances of the variables’ effects and the methodologies employed in these studies. The key macroeconomic factors identified include interest and exchange rate sensitivity, which has been studied extensively; however, the impact of monetary policies, gold prices and oil prices needs further investigation. Subsequently, the study documents various bank-specific characteristics that influence the relationship between macroeconomic factors and bank stock returns.

AbstractThis study analyzes the effect of monetary policy, measured by interest rates and money supply, on financial markets. Furthermore, it studies the impact of a crisis on monetary policy’s influence on financial markets. The stock and the bond market are used to reflect financial markets. This quantitative study is based on daily data from Thailand before, during and after the COVID-19 pandemic for 15 years. The article finds that interest rate and money supply increases lead to increased stock returns and increased government bond yields. Moreover, during a crisis, interest rate and money supply changes have a larger impact on stock returns and bond yields. The greater the severity of a crisis, the larger the effect of interest rate and money supply changes on financial markets. The results suggest that the central bank may use monetary policy to a different extent during a crisis than during normal times. Investors should consider adjusting their investment strategies during times of crisis to account for the larger impact of monetary policy on financial markets.

This study investigates the long-run relationship between the exchange rate, interest rate, stock prices and output. The results demonstrate that a single restricted relationship is accepted when a structural break is incorporated into the cointegrating vector. Compared with the hypothesis tests on the single restricted relationship, the hypothetical structure comprising multiple relationships in the cointegrating vector is generally accepted in most countries, confirming the interaction between the relationships in the system. Our findings regarding the real exchange rate and stock price differentials appear to contradict the uncovered equity returns parity condition, whereas the relationship between the real exchange rate and interest rate differentials is consistent with the flexible price approach. [ABSTRACT FROM AUTHOR]

The dynamic and interconnected nature of inflation, interest rates, general government final consumption expenditure, and economic growth underscores their mutual influence. This paper aims to explore how inflation, real interest rates, and general government final consumption expenditure impact economic growth in Western Balkan countries from 2008 to 2022. Specifically, the study seeks to determine the significance of these factors in shaping economic performance in the region. Employing analytical techniques such as Ordinary Least Squares (OLS), fixed and random effects models, and the Hausman-Taylor model with instrumental variables (IVs), the research assesses the role of inflation, interest rates, and government consumption. The findings reveal that inflation and general government final consumption expenditure exert a significant influence on the economy in the Western Balkans, as evidenced by the application of the Hausman-Taylor instrumentals IVs. On the other hand, real interest rates exhibit insignificant effects on economic growth. Understanding these relationships is imperative for policymakers and economists in crafting effective monetary and fiscal policies that foster sustainable economic growth while upholding price stability. By comprehensively analyzing the interactions between inflation, interest rates, general government final consumption expenditure, and economic growth, policymakers can make informed decisions to bolster macroeconomic stability and prosperity across the region. Furthermore, this research contributes to the existing literature by providing insights into the specific dynamics of economic growth in the Western Balkans region. By examining the impact of inflation, real interest rates, and general government final consumption expenditure on economic performance over the specified period, the study offers valuable evidence that can inform policy formulation and decision-making processes. Additionally, the findings underscore the importance of tailored policy interventions to address the unique economic challenges and opportunities faced by Western Balkan countries, ultimately aiming to foster sustainable development and prosperity in the region. Moreover, the study highlights the need for continued monitoring and evaluation of macroeconomic indicators in the Western Balkans to ensure effective policy responses to evolving economic conditions. By incorporating a comprehensive analysis of inflation, interest rates, and general government final consumption expenditure into policymaking frameworks, policymakers can enhance their ability to mitigate economic risks and capitalize on growth opportunities. Ultimately, this research aims to contribute to the ongoing dialogue on economic development in the Western Balkans and facilitate evidence-based policymaking for sustainable and inclusive growth in the region. [ABSTRACT FROM AUTHOR]

For the period 2007:Q1-2023:Q3, this study investigates the relationship between the general level of prices, FED interest rate policy, and financial markets in the Turkish economy. The study uses data on FED interest rate policy, general price level, and stock price. This study also includes economic policy uncertainty data to investigate the impact of political and economic uncertainty on financial markets. RALSADF unit root test, AARDL (Augmented ARDL) bounds examination and Hatemi-J asymmetric causality test are used to determine the relationship between the variables in the study. According to the findings obtained from the augmented ARDL test, it is determined that the general level of prices has a positive effect on BIST100 in the long run, and the FED interest rate policy has a positive effect on BIST100 in the short run. According to the results obtained from the Hatemi-J asymmetric causality test, positive and negative shocks in the general level of prices data have a significant effect on BIST100, but positive shocks are more effective than negative shocks, while positive shocks in the economic policy uncertainty data have a positive effect on BIST100. [ABSTRACT FROM AUTHOR]

The current account balance is a component of the balance of payments, in which a surplus or deficit is a form of a country's external balance or imbalance. Since the 2008 financial crisis and the COVID-19 pandemic, several countries, especially developing countries, have experienced external imbalances, which is related to a continuous pattern of transactions with the rest of the world. Developing countries in the ASEAN region are often vulnerable to experiencing external imbalances which are reflected in their current account balance, which every year the country continues to fluctuate and tends to decrease until it experiences a current account deficit. This research was conducted to analyze the impact of monetary policy and macroeconomic indicators on the current account situation of developing countries in the ASEAN region during the 15 year period of 2007-2021. The Current Account Balance as the dependent variable and the independent variable uses Interest Rates in explaining monetary policy and macroeconomic variables including Exchange Rate, Inflation, Gross Domestic Product, Foreign Direct Investment, and Trade Openness. This study analyzes long-term and short-term effects using the VECM panel model. The results show that Interest Rates in the short term has no effect, but in the longer term has a significant negative effect. The Exchange Rate in the short term and long term have a significant positive effect. Inflation and GDP have no effect in the short term but have a significant negative effect in the long term. FDI has a significant positive effect in the short term and the long term. And finally, Trade Openness in the short term has a significant positive and in the long term has a significant negative effect. [ABSTRACT FROM AUTHOR]

Several authors, especially those who share a Classical–Keynesian point of view, argue that the interest rate determines the rate of profit in the long run. Considering the eleven founding economies of the euro area, I find that, adjusted for the rate of growth of gross national income, there is a positive long-term relationship between the real interest rate and the net rate of profit. The results are confirmed even when I estimate a model with nominal interest rates, inflation, and a yield curve. These results imply that the European Central Bank (ECB), when deciding monetary policy, is not neutral in determining income distribution. [ABSTRACT FROM AUTHOR]

In this study, the effects of financial openness and interest rate on exchange rate volatility, which are important especially for the internal and external balance purposes of developing countries, were investigated. For this purpose, quarterly data for the period 2002Q1-2023Q1 regarding financial openness, interest rates, and exchange rate volatility determined by the EGARCH method for Turkey were used in the study. In the study, ADF unit root test and the new generation time series analyses, F-Kruse unit root and Fourier-Shin cointegration tests, were used. Furtermore, DOLS model was estimated to determine the longterm coefficients. The results of used analyzes showed that the increase in financial openness and interest rates had respectively negative and positive effects on exchange rate volatility in Turkey. These findings have pointed that Turkey is a country in need of external borrowing, and it should be given importance financial stability as well as interest rates. [ABSTRACT FROM AUTHOR]

The article analyzes the relationship between macroeconomics and (labor) poverty between 2005 and 2022. Three scenarios were considered: 1) income, inflation, interest rate and labor poverty, while scenarios 2) and 3) considered labor income and inflation of lines of poverty and extreme poverty in relation to income, respectively. An impulse response function and its cointegrating relationship are estimated for each scenario. The results suggest that the interest rate does indeed have an impact on poverty: a monetary policy that prioritizes low and stable inflation corresponds to a lower poverty rate, as well as higher income. Finally, it is concluded that inflation is detrimental to poverty. [ABSTRACT FROM AUTHOR]

This paper focuses on the examination of the long-run relationship between money supply and selected national and global stock indices. Detailed knowledge of this relationship can be used by analysts, investors and monetary policy makers. Analysis of the relationship was performed using a 2-stage Engle-Granger cointegration. First, the stationarity of the time series was tested, then both the long-term OLS model and the short-term EC model were estimated. Time series were always tested on the longest period for which data were available. The long-term dependence of stock indices on the respective M2 was confirmed for the BOVESPA, FTSE100, S&P/BMV IPC, S&P BSE500, TSX and The 5000 Wilshire Small Cap Price Return indices. In contrast, the dependence between world money supply indicator GlobalM2, the stock index FTSEALL World, and the S&P500 index was not demonstrated. Additionally, no dependence was identified between the respective M2 and the DAX, PX, Nikkei225, KOSPI, SMI, SPCITIC300, Eurostoxx50, Willshire5000PR and ATX indices. Backward dependence of M2 on the stock index was found only for the Chinese SPCITIC300 index. [ABSTRACT FROM AUTHOR]

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The core objective of this article is to explore the viability of uncovered interest parity and to reconnoiter major determinants of domestic interest rates of the Pakistan and China economies. It is imperative to study the interest rate parity that assistances to comprehend that exactly how exchange rate and domestic interest rate influence foreign interest rate of two economies in emerging trends in international trade. The World Development Indicators is main source of data gathering, and it ranges from 1980 to 2023 for the analysis of both models. This study considers two models, Engle–Granger causality has been applied in Model 1, to analyze the uncovered interest parity, and findings indicate that the exchange rate of each country has no effect on the interest rate of the other country. However, Model 2 investigates the main determinants of domestic interest rate and their long-run associations for Pakistan and China. To capture the long-run association, ARDL estimation technique has been deployed, and findings show the long-run relations and co-integration among the policy variables of both countries. In Pakistan, consumer price index and exchange rate hold positive linking with the domestic interest rate; however, output level is adversely correlated. The error correction term is 91%, confirming the rapidity of equilibrium adjustment when a shock occurs. Regarding the Chinese economy, consumer price index and exchange rate have a negative impact on China domestic interest rate. The results of the error correction model indicate an 80% speed of convergence in the long run. This study suggests that improvement in productivity and exchange rate may assist both economies to experience steady exchange rate and interest rate. [ABSTRACT FROM AUTHOR]

The author asserts that the credit multiplier of the country's banking system regulates the growth of the economy and characterizes the level of its development. It is proved that the limiter and the indicator of economic development is the share of value added by production in the aggregate product, which determines the existing technological mode. It is proved that the ratio of the nominal GDP to the monetary base of the Central Bank is identical to the product of the credit multiplier and the velocity of money circulation that is constant for each technological mode. Here, industrial economies, developed economies, and highly developed economies are considered. The marginal zero inflation multiplier is determined, at which the real GDP growth stops and a transition to a deflationary crisis occurs. It is established that the Central Bank's increase in the interest rate to reduce inflation leads to a sharp decrease in the multiplier and lending to production, while credit regulation allows us to reduce inflation by targeting without changing the interest rate and without reducing lending. A method for regulating the economy with a credit multiplier using an engineering calculator was developed. The economic recovery of Ukraine in 2024–2025 was simulated. [ABSTRACT FROM AUTHOR]

Levels of government debt-to-GDP have been rising substantially for over a decade in emerging market economies such as South Africa, which has led to much debate around the implementation of large-scale debt-financed fiscal stimulus programs in response to the economic fallout of the global covid-19 pandemic. Debt-financed fiscal policies directly stimulate aggregate demand through government expenditure or tax cuts, but their effectiveness is highly dependent on direct crowding-out of private sector expenditure, spill-over effects to the private sector through a higher risk premium on interest rates, and the interaction between fiscal policy and monetary policy. Using an open-economy dynamic stochastic general equilibrium model for South Africa, we identify the effect of six different fiscal policy instruments on short-term and long-term interest rates. These disaggregated expenditure and revenue shocks raise long-term real yields between 18 and 29 basis points, but there are non-negligible differences in the dynamic responses to each fiscal instrument. Our main findings suggest that, in the context of fiscal sustainability, an investment-driven debt-financed fiscal stimulus programme would reduce the government debt-to-GDP ratio, especially in periods of economic slack when monetary policy would typically be more accommodative. In fact, since the global financial crisis, monetary policy has reduced the burden of fiscal adjustment in response to rising debt and a rising risk premium. But further shocks to the risk premium could offset any gains from the current stance of monetary policy (for example, a credit rating shock raises the long-term government bond rate 155 basis points). [ABSTRACT FROM AUTHOR]

The relevance of the study is that the pandemic has affected the financial stability of many businesses. The purpose of the study is to consider the features of bank lending to businesses in a pandemic. Providing credit in the era of the coronavirus is associated with increased risk. However, this does not mean that it is impossible to obtain new funding. Banks still offer a variety of credit products, including mortgages and cash or credit card loans. Changes in the level of debt mask the distinction between new borrowings and repayments of existing amounts. Business loans are mostly short-term, and their rates can be adjusted relatively easily. Historical data shows that on average, 90% of new business loans have a variable or fixed rate with a maturity of less than one year. The huge surge in loans to new businesses is primarily conditioned upon this short-term financing. The speed and scale of the return of the gap to the pandemic is unprecedented. The practical significance lies in the analysis of problems and obstacles to bank lending to businesses in a pandemic, and ways to solve them. [ABSTRACT FROM AUTHOR]

We propose a real options model with regime shifts to investigate the effect of cutting interest rates on corporate investments when a financial crisis occurs. Cutting interest rates would lower the investment project's hurdle rate. The reduction in hurdle rate is positively related to the magnitude of interest rate cuts and the persistence of the financial crisis. The hurdle rate becomes lower in the financial crisis state because the reduction in interest rate would lower the cost of capital and the opportunity cost of immediate investment. In the numerical analysis of this study, we show that the change in the opportunity cost accounts for most of the change in the hurdle rate. Upon taking into consideration the firm's financing constraints, we find that cutting interest rates accelerates investments for firms with high liquidity. However, for firms with low liquidity, the optimal investment threshold is not affected by the variation in interest rates. Instead, the investments of low‐liquidity firms are affected by the change in the friction of credit supply. [ABSTRACT FROM AUTHOR]