H. Abas, Khairizah; Yusof, Z.; Samsi, Siti Muliana (2010) Monetary Model of Ringgit Exchange. In: Proceedings of 2010 International Conference on Business, Economics and Tourism Management (CBETM 2010) , 26-28 February, 2010, Singapore.
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This study re-examines the dynamic linkages between exchange rate and its monetary fundamentals namely, money, income and interest rate in a small emerging state of Malaysia. It investigates the short-run dynamics and long run relationships between ringgit exchange and its fundamental monetary variables. Based on the flexible price monetary framework, the model was tested via Johansen cointegration technique and vector error correction model using data set from 1980:Q1 to 2008:Q3. The findings suggest a strong evidence of long run relationship between exchange rate and the monetary fundamentals in Malaysia. Interestingly, further examination demonstrates that ringgit adjusts gradually to changes in money, income and interest rate, generally implying less volatile ringgit.
|Item Type:||Conference or Workshop Item (Paper)|
|Uncontrolled Keywords:||Monetary model of exchange rate, flexible price model, money, cointegration, vector error correction model|
|Subjects:||H Social Sciences > HB Economic Theory|
H Social Sciences > HG Finance
|Divisions:||Faculty of Economics & Administration|
|Depositing User:||Mr Mohd Fazli Zainordin|
|Date Deposited:||07 May 2012 14:58|
|Last Modified:||11 Dec 2014 17:14|
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