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The impact of monetary policy on BRIC markets asset prices during global financial crises

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  • Galloppo, Giuseppe
  • Paimanova, Viktoriia

Abstract

This paper investigates the influence of Central Authorities on emerging financial markets (BRIC area) by means of Monetary Policy. The sample period relates to financial crises. We suggest this work to be probably the first one dealing with external shocks across different economic sectors, and in Emerging Market economies. Hence, it enlarges the existing financial literature. On emphasizing contractionary and expansionary policies, we tried to get the most precise output, and aimed to investigate, whether there was some interdependence between stock price reaction and international trade flows. We found the predominance of positive reply and the most active response to contractionary policy. We found the largest amount of feedbacks to the Bank of Japan and the lowest—to the Bank of England. On considering these findings, our analyses revealed the highest number of responses from Utilities and Basic Materials’ sectors and detected the existence of some unexpected and controversial reactions from certain countries.

Suggested Citation

  • Galloppo, Giuseppe & Paimanova, Viktoriia, 2017. "The impact of monetary policy on BRIC markets asset prices during global financial crises," The Quarterly Review of Economics and Finance, Elsevier, vol. 66(C), pages 21-49.
    • Handle: RePEc:eee:quaeco:v:66:y:2017:i:c:p:21-49
    DOI: 10.1016/j.qref.2017.02.008
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    2. Juhro, Solikin M. & Iyke, Bernard Njindan & Narayan, Paresh Kumar, 2021. "Interdependence between monetary policy and asset prices in ASEAN-5 countries," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 75(C).
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    4. Justinas Lubys & Pradiptarathi Panda, 2021. "US and EU unconventional monetary policy spillover on BRICS financial markets: an event study," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 48(2), pages 353-371, May.
    5. Iyke, Bernard Njindan & Maheepala, M.M.J.D., 2022. "Conventional monetary policy, COVID-19, and stock markets in emerging economies," Pacific-Basin Finance Journal, Elsevier, vol. 76(C).

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    More about this item

    Keywords

    Stock market reaction; Monetary policy; Event study; Emerging markets; Financial crisis;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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