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Do
Exchange Rates Cause Stock Prices, or Vice-Versa? Evidence
From Malaysia -- Mohd.
Fahmi Ghazali, Siti Hajar Samsu, Ooi Ai Yee and Nelson Lajuni
The
main purpose of this paper is to examine the relationship
between stock prices and exchange rates in Malaysia, for
the periods immediately before and during the 1997 Asian
crisis, and during the currency unpegged period. This research
considers high-frequency data of USD-MYR exchange rates
and Kuala Lumpur Composite Index (KLSE). The Toda-Yamamoto
causality test finds that there was no causality at all
during the non-crisis and crisis periods.
©
2008 The Icfai University Press. All Rights Reserved.
Currency
Crises and Monetary Policy in Economies with Partial Dollarization
of Liabilities -- Christian
Proano, Peter Flaschel and Willi Semmler
After
the breakdown of aggregate investment observed after the
1997-98 East Asian crisis, in almost all countries which
suffered from sharp nominal devaluations, academicians and
policymakers have engaged in a hot debate about the adequate
monetary policy strategy against a speculative attack on
the domestic currency. By means of a simple currency crisis
model based on Proano, Flaschel and Semmler (2005), this
paper shows how an increase in the domestic interest rate
by the central bank, as a response to a currency run on
the domestic currency, can significantly affect the aggregate
demand by depressing the investment of the subsector of
domestic firms which are not indebted in foreign currency.
©
2008 The Icfai University Press. All Rights Reserved.
Does
Credit Channel Matter in the Conduct of Monetary Policy
in Singapore? -- Wai-Ching
Poon
This
paper employs the bounds testing approach for cointegration
analysis (Pesaran et al., 2001) to examine the impact of
interest rate and exchange rate on output, and then uses
the estimated weights to construct Monetary Conditions Index
(MCI) for Singapore over the quarterly period 1981-2004.
Designed to measure the stance of monetary condition, MCI
plays an important role for the conduct of monetary policy.
©
2008 The Icfai University Press. All Rights Reserved.
Monetary
Hyperinflations, Speculative Hyperinflations
and Modeling the Use of Money --
Alexandre Sokic
The
aim of this paper is to clarify the failure of the Cagan
model with perfect foresight, and to draw new axes for the
investigation of monetary hyperinflation analysis. Firstly,
the paper evaluates the relevance of the Cagan d hoc model
with perfect foresight as a theoretical framework for investigating
hyperinflation processes. It is shown that deficits can
never generate monetary hyperinflations, confirming the
results of Buiter (1987).
©
2008 The Icfai University Press. All Rights Reserved.
Macroeconomic
Fluctuations and Stabilization Policy Implications for Lesotho
-- Powell
L Mohapi and Matamatama C Mohapi
This
paper computes the facts on macroeconomic variables and
investigates the implications of those facts for stabilization
policy interventions for Lesotho. The Hodrick-Prescott (HP)
filter is used to separate the trend and cyclical components
of Lesotho macroeconomic variables, grouped into expenditure
components—monetary variables, external variables and
labor market variables.
©
2008 The Icfai University Press. All Rights Reserved.
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