Interest Rates, Exchange Rates and Macroeconomic Performance

Erdoğan, Seyfettin and Karacan, Rıdvan and Alpaslan, Barış (2013): Interest Rates, Exchange Rates and Macroeconomic Performance.

Abstract

In recent years, there has been a renewed interest in the fact that a change in exchange rates has an impact on main economic indicators and therefore on macroeconomic performance. The aim of this paper is to study the implications of the relationship between exchange rates and changes in short-term interest rates on macroeconomic performance in the Turkish economy. The results of this study show that monetary policy shocks may affect financial sector and real sector through exchange rates.

• Item Type: MPRA Paper
• Language: English
• Keywords: Interest Rate, Exchange Rate, VAR Analysis
• Subjects: C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C13 - Estimation: General; E - Macroeconomics and Monetary Economics > E4 - Money and Interest Rates > E40 - General; E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy; E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E58 - Central Banks and Their Policies

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