On the Malaysian ringgit exchange rate determination and recent depreciation

The Ringgit (MYR) has recently, since October 2015, suffered a large decline against most world currencies. In this study, based on the theory of exchange rate determination, we tested for a long run relationship between both MYRUSD and MYRGBP against the differential interest rate, differential...

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Main Authors:	Quadry, Mahmud Oluwaseyi, Mohamad, Azhar, Yusof, Yusniliyana
Format:	Article
Language:	English English
Published:	IIUM Press, International Islamic University Malaysia 2017
Subjects:	HG201 Money HG3810 Foreign exchange
Online Access:	http://irep.iium.edu.my/57072/ http://irep.iium.edu.my/57072/ http://irep.iium.edu.my/57072/1/57072_On%20the%20Malaysian.pdf http://irep.iium.edu.my/57072/7/57072_On%20the%20Malaysian%20ringgit%20exchange_WOS.pdf

id	iium-57072
recordtype	eprints
spelling	iium-570722017-07-18T05:27:14Z http://irep.iium.edu.my/57072/ On the Malaysian ringgit exchange rate determination and recent depreciation Quadry, Mahmud Oluwaseyi Mohamad, Azhar Yusof, Yusniliyana HG201 Money HG3810 Foreign exchange The Ringgit (MYR) has recently, since October 2015, suffered a large decline against most world currencies. In this study, based on the theory of exchange rate determination, we tested for a long run relationship between both MYRUSD and MYRGBP against the differential interest rate, differential money supply, price of world crude oil and Goods and Services Tax (GST, as dummy variable). We ran an Autoregressive Distributive Lag (ARDL) model on monthly data from January 2010 to January 2017. We found a negative long run relationship between MYRGBP and differential money supply and a positive long run relationship against the world crude oil price. As the Ringgit (MYR) supply increased relative to the British Pound, the Ringgit depreciated, and as the crude oil price strengthened, the Ringgit appreciated. A high dependency of the Ringgit on world crude oil implies a bad sign. In our view, Malaysia needs to work harder to attract foreign direct investment to maintain the value of the Ringgit at a healthy level. IIUM Press, International Islamic University Malaysia 2017 Article PeerReviewed application/pdf en http://irep.iium.edu.my/57072/1/57072_On%20the%20Malaysian.pdf application/pdf en http://irep.iium.edu.my/57072/7/57072_On%20the%20Malaysian%20ringgit%20exchange_WOS.pdf Quadry, Mahmud Oluwaseyi and Mohamad, Azhar and Yusof, Yusniliyana (2017) On the Malaysian ringgit exchange rate determination and recent depreciation. International Journal of Economics, Management and Accounting, 25 (1). pp. 1-26. E-ISSN 2462-1420 http://journals.iium.edu.my/enmjournal/index.php/enmj/article/view/366/228
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English English
topic	HG201 Money HG3810 Foreign exchange
spellingShingle	HG201 Money HG3810 Foreign exchange Quadry, Mahmud Oluwaseyi Mohamad, Azhar Yusof, Yusniliyana On the Malaysian ringgit exchange rate determination and recent depreciation
description	The Ringgit (MYR) has recently, since October 2015, suffered a large decline against most world currencies. In this study, based on the theory of exchange rate determination, we tested for a long run relationship between both MYRUSD and MYRGBP against the differential interest rate, differential money supply, price of world crude oil and Goods and Services Tax (GST, as dummy variable). We ran an Autoregressive Distributive Lag (ARDL) model on monthly data from January 2010 to January 2017. We found a negative long run relationship between MYRGBP and differential money supply and a positive long run relationship against the world crude oil price. As the Ringgit (MYR) supply increased relative to the British Pound, the Ringgit depreciated, and as the crude oil price strengthened, the Ringgit appreciated. A high dependency of the Ringgit on world crude oil implies a bad sign. In our view, Malaysia needs to work harder to attract foreign direct investment to maintain the value of the Ringgit at a healthy level.
format	Article
author	Quadry, Mahmud Oluwaseyi Mohamad, Azhar Yusof, Yusniliyana
author_facet	Quadry, Mahmud Oluwaseyi Mohamad, Azhar Yusof, Yusniliyana
author_sort	Quadry, Mahmud Oluwaseyi
title	On the Malaysian ringgit exchange rate determination and recent depreciation
title_short	On the Malaysian ringgit exchange rate determination and recent depreciation
title_full	On the Malaysian ringgit exchange rate determination and recent depreciation
title_fullStr	On the Malaysian ringgit exchange rate determination and recent depreciation
title_full_unstemmed	On the Malaysian ringgit exchange rate determination and recent depreciation
title_sort	on the malaysian ringgit exchange rate determination and recent depreciation
publisher	IIUM Press, International Islamic University Malaysia
publishDate	2017
url	http://irep.iium.edu.my/57072/ http://irep.iium.edu.my/57072/ http://irep.iium.edu.my/57072/1/57072_On%20the%20Malaysian.pdf http://irep.iium.edu.my/57072/7/57072_On%20the%20Malaysian%20ringgit%20exchange_WOS.pdf
first_indexed	2023-09-18T21:20:37Z
last_indexed	2023-09-18T21:20:37Z
_version_	1777411856934109184

On the Malaysian ringgit exchange rate determination and recent depreciation

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