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Money supply and inflation dynamics in the Asia-Pacific economies: a time-frequency approach

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  • Bekiros Stelios

    (Department of Economics, European University Institute (EUI), Villa La Fonte, Via delle Fontanelle, 18, I-50014, Florence, Italy, Tel.: +390554685925, Fax: +390554685902;)

  • Muzaffar Ahmed T.

    (University of Western Sydney, School of Business, Parramatta Campus, Locked Bag 1797, Penrith, NSW 2751, Australia)

  • Uddin Gazi S.

    (Linköping University, Department of Management and Engineering, SE-581 83Linköping, Sweden)

  • Vidal-García Javier

    (Complutense University Madrid, Madrid, Spain)

Abstract

We examine the relationship between money supply growth and inflation in 3 Asian Economies which are India, Malaysia and Japan using a time-frequency approach. The application of a unified multi-scale analysis allows us to provide a continuous assessment of the link between money supply growth and inflation, unlike most of the existing literature studying this relationship. We also employ a bivariate frequency-domain causality test to determine the nature and direction of interdependence between money supply growth and inflation dynamics. Our findings provide a better understanding of their lead-lag linkages and causal relationship in the selected countries of the Asia-Pacific region.

Suggested Citation

  • Bekiros Stelios & Muzaffar Ahmed T. & Uddin Gazi S. & Vidal-García Javier, 2017. "Money supply and inflation dynamics in the Asia-Pacific economies: a time-frequency approach," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 21(3), pages 1-12, June.
    • Handle: RePEc:bpj:sndecm:v:21:y:2017:i:3:p:12:n:3
    DOI: 10.1515/snde-2016-0051
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    References listed on IDEAS

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    Cited by:

    1. Camilleri, Silvio John & Scicluna, Nicolanne & Bai, Ye, 2019. "Do stock markets lead or lag macroeconomic variables? Evidence from select European countries," The North American Journal of Economics and Finance, Elsevier, vol. 48(C), pages 170-186.
    2. Uddin, Gazi Salah & Bekiros, Stelios & Ahmed, Ali, 2018. "The nexus between geopolitical uncertainty and crude oil markets: An entropy-based wavelet analysis," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 495(C), pages 30-39.

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    More about this item

    Keywords

    monetary policy; wavelet analysis; nonlinear causality;
    All these keywords.

    JEL classification:

    • C40 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - General
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General

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