Open AccessAsset Price Channel of Monetary Policy in Pakistan
Author(s) -
Saleem A. Shah,
Irfan Hussain Khan,
Alamgir Khan
Publication year - 2021
Publication title -
global economics review
Language(s) - English
Resource type - Journals
eISSN - 2707-0093
pISSN - 2521-2974
DOI - 10.31703/ger.2021(vi-iv).07
Subject(s) - economics , monetary policy , granger causality , consumer price index (south africa) , money supply , wholesale price index , monetary economics , price level , descriptive statistics , econometrics , price index , index (typography) , financial economics , mid price , statistics , mathematics , computer science , world wide web
This study has used Vector Auto-Regressive (VAR)model approach to analyze the Asset Price Channel of Monetary Transmission (APCMT) regarding Pakistan. Study use the date period of 34 years from 1980 to 2 14. Major findings of the study are; stock prices have bi-directional causality with industrial price index and money rte. Granger causality test was employed to check multi-directional causality between stock prices and industrial product index, money supply, money market rate,and consumer price index, whereas stock prices do not have significant causality with money supply and consumer price in ex.Descriptive statistics are used to check the normality of the data,and mean, median, standard deviation, Jerq-Berra, maximum and minimum values were calculated through descriptive statistics approach. For policy designing, this study has some important implications, and it gives emphasis on financial prices instead of credit to achieve the objective of the monetary policy of Pakistan.