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Impact of Monetary Policy on Performance of Dhaka Stock Exchange

Author

Listed:
  • Mohotarema Rashid

    (Bangladesh Army University of Science and Technology, Bangladesh)

  • Ummay Mahima Ima

    (angladesh University of Professionals, Dhaka- 1216, Bangladesh)

Abstract

This paper investigates the effect of monetary variables on the performance of stock market of Bangladesh using yearly data over the period of year 2008 to 2019. The objective of the study is to consider the effectiveness and consequences of different monetary variables on stock market of Bangladesh. As a dependent variable DSEX index has been used as a proxy variable for stock market performance and three independent variables repo rate, inflation rate, money market rate has been used as proxy of monetary variables. An ordinary least square method shows that 1% increase in money market rate, repo rate, and inflation rate the index value is decreased by 3.30%,1.20% and increased by 1.90% respectively. So this is suggested that investor should consider the above variables to make strategic decisions about portfolio and investment management.

Suggested Citation

  • Mohotarema Rashid & Ummay Mahima Ima, 2020. "Impact of Monetary Policy on Performance of Dhaka Stock Exchange," International Journal of Science and Business, IJSAB International, vol. 4(10), pages 121-127.
    • Handle: RePEc:aif:journl:v:4:y:2020:i:10:p:121-127
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    References listed on IDEAS

    as
    1. Frederic S. Mishkin, 1977. "What Depressed the Consumer? The Household Balance Sheet and the 1973-75 Recession," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 8(1), pages 123-174.
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