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A monetary analysis of foreign exchange market disequilibrium in Fiji

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  • Shabbir Ahmad
  • Abul Shamsuddin
  • Malcolm Treadgold

Abstract

This paper evaluates a monetary model of foreign exchange market pressure in Fiji using the autoregressive distributed lag bounds testing methodology. The results suggest that if the monetary authorities in Fiji fix the exchange rate, they lose the ability to implement an independent monetary policy through control of central bank credit. Stronger monetary control is regained to the extent that pressure in the foreign exchange market is relieved through exchange rate movements rather than reserve movements.

Suggested Citation

  • Shabbir Ahmad & Abul Shamsuddin & Malcolm Treadgold, 2012. "A monetary analysis of foreign exchange market disequilibrium in Fiji," International Journal of Economic Policy in Emerging Economies, Inderscience Enterprises Ltd, vol. 5(1), pages 66-81.
    • Handle: RePEc:ids:ijepee:v:5:y:2012:i:1:p:66-81
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    References listed on IDEAS

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    Cited by:

    1. Adnan Ali Shahzad & Shabbir Ahmad & Naveed Hayat & Muhammad Imran & Jamshaid Ur Rehman, 2022. "Impact Of Oil Price, Exchange Rate, And Interest Rate On Stock Market Of Pakistan," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 11(1), pages 172-183.
    2. Shabbir Ahmad, 2017. "Sustainability of the Current Account: Evidence from Pakistan," International Journal of Economics and Financial Issues, Econjournals, vol. 7(2), pages 68-72.

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