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Stock Prices and Real Exchange Rate Movements in the Gulf Cooperation Council

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  • Khalifa Hassanain

    (Research Division, Islamic Research and Training Institute/Islamic, Development Bank, Jeddah 21413, Kingdom of Saudi Arabia.)

Abstract

In this paper, we examine the interaction between stock prices and the real and nominal exchange rates in the Gulf Cooperation Council (GCC) economies (including only Kuwait (KW) and Saudi Arabia (SA). We consider the real and the nominal exchange rates of US dollar in terms of the Saudi Riyal and Kuwait Dinar and the values of Saudi and Kuwait exchange stock exchange indexes. The purpose is to investigate relationship between the volatility in stock prices in these markets and the large swings in global currencies given their alternative exchange rate arrangements. Real exchange rate appears to be insignificant in the case of Kuwait but significant in the case of Saudi Arabia.

Suggested Citation

  • Khalifa Hassanain, 2017. "Stock Prices and Real Exchange Rate Movements in the Gulf Cooperation Council," International Journal of Economics and Financial Issues, Econjournals, vol. 7(1), pages 92-96.
    • Handle: RePEc:eco:journ1:2017-01-14
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    References listed on IDEAS

    as
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    Cited by:

    1. Andre Yone Haughton & Emma M. Iglesias, 2017. "Exchange Rate Movements, Stock Prices and Volatility in the Caribbean and Latin America," International Journal of Economics and Financial Issues, Econjournals, vol. 7(2), pages 437-447.

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    More about this item

    Keywords

    Stock Prices; Exchange Rate; Real Exchange Rate;
    All these keywords.

    JEL classification:

    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

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