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The Effects of Global Commodity Prices on Domestic Prices in Saudi Arabia

Author

Listed:
  • Moayad Al Rasasi

    (Economic Specialist, Economic Research Department, Saudi Arabian Monetary Authority, Saudi Arabia,)

  • Goblan Algahtani

    (Economic Specialist, Monetary Policy and Financial Stability Department, Saudi Arabian Monetary Authority, Saudi Arabia,)

  • Abdulrahman Alqahtani

    (Economic Specialist, International Affairs Department, Saudi Arabian Monetary Authority, Saudi Arabia)

Abstract

This paper evaluates the impacts of global commodity prices on domestic prices in Saudi Arabia with aid of econometric techniques and monthly data over the period 2000:01-2016:09. We find evidence suggesting the influential role of global commodity prices on Saudi domestic prices over long run. In particular, we find that non-fuel commodity prices have more impacts on domestic prices than energy prices. Likewise, we find evidence, based on Granger causality analysis, suggesting that global commodity prices are useful indicators in capturing the movements in domestic prices.

Suggested Citation

  • Moayad Al Rasasi & Goblan Algahtani & Abdulrahman Alqahtani, 2017. "The Effects of Global Commodity Prices on Domestic Prices in Saudi Arabia," International Journal of Economics and Financial Issues, Econjournals, vol. 7(4), pages 590-594.
    • Handle: RePEc:eco:journ1:2017-04-68
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    References listed on IDEAS

    as
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    3. Joanne Cutler & Carrie Chan & Unias Li, 2005. "The Relationship between Commodity and Consumer Prices in Mainland China and Hong Kong," Working Papers 0508, Hong Kong Monetary Authority.
    4. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Global Commodity Prices; Domestic Prices; Saudi Arabia;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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