scholarly journals The Impact of Short- Term Interest Rates on Bank Funding Costs

2018 ◽  
Vol 10 (3(J)) ◽  
pp. 141-148
Author(s):  
Azasakhe Nkcubeko Nomsobo ◽  
Roscoe Bertrum Van Wyk
Keyword(s):  
Interest Rates ◽  
Financial Stability ◽  
Time Series Data ◽  
Series Data ◽  
Bank Capital ◽  
Short Term ◽  
Government Bonds ◽  
Bank Funding ◽  
The Impact

This study examines the impact of short- term interest rates on bank funding costs in South Africa. Literature suggests that rising short- term interest rates may cause similar financial crises experienced in 2007/08 (Bonner & Eijffinger, 2013; Turner, 2013; Saraç & Karagoz, 2016). It is vital to study short- term interest rates and bank funding costs in order to achieve financial stability. The study uses quarterly time series data for the period 2000 to 2014. To estimate the regression, the study uses the Vector Autoregressive model (VAR) and the data is found stationary at first difference. The 3 months Johannesburg Interbank Agreed Rate (JIBAR) is used as a proxy for bank funding costs whilst the prime overdraft rate, 10 -year government bonds and capital ratio are used as proxies for short- term, long- term interest rates and bank capital, respectively. The results show a positive and significant long- term relationship between the variables. The results for prime overdraft rate, 10 -year government bonds and capital ratio conform to the apriori expectations. For GDP growth the results show a positive relationship which does not conform to apriori expectations. Using the variance decomposition, the study illustrates fluctuations in JIBAR was due to changes in its value and fluctuations in the prime rate are also due to JIBAR. The study presents policy options whereby regulatory efforts need to strengthen the capital buffers of banks to reduce bank funding costs and therefore reduce short- term interest rates imposed on borrowers.

scholarly journals ANALISIS PENGARUH VARIABEL MAKRO EKONOMI TERHADAP INVESTASI ASING LANGSUNG (STUDY KASUS CHINA-INDONESIA).

2017 ◽  
Vol 6 (2) ◽  
pp. 103
Author(s):  
Ririn Martini Rezki ◽  
Yeniwati Yeniwati ◽  
Mike Triani
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Exchange Rate ◽  
Interest Rates ◽  
Direct Investment ◽  
Time Series Data ◽  
Least Square ◽  
Series Data ◽  
Short Term

This research to analyze the influence of macro economic variables impact on Chinese Foreign Direct Investment in Indonesia. The influence of China’s economic growth, Indonesia’s economic growth, interest rates, inflation and exchange rates against Foreign Direct Investment (FDI) China in Indonesia in the long term and short term. Type of this research is descriptive research, the secondary data use form time series data, from 2001Q1 – 2016Q4, taken  from agencies and related institution, the analysis using the Ordinary Least Square (OLS) and Error Correction Model (ECM) to see the influence in a long term and impact in the short term. This research show that Indonesia’s economic growth of China’s economic growth and inflation is have a significant effect in the long term Chinas’s FDI in Indonesia. Variable economic growth of Indonesia’s, interest rates, inflation, exchange rate in the short term influence China’s Foreign Direct Investment in Indonesia. How ever in the long term interest rates and exchange rate do not influence significantly, to China’s FDI in Indonesia.

scholarly journals THE ANALYSIS OF THE TRANSMISSION MECHANISM OF MONETARY POLICY IN CONVENTIONAL AND SHARIA AGAINST INFLATION IN INDONESIA

2021 ◽  
Vol 9 (1) ◽  
Author(s):  
Julika Rahma Siagian
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Money Supply ◽  
Financial Services ◽  
Time Series Data ◽  
Transmission Mechanism ◽  
Series Data ◽  
Analysis Tool ◽  
Short Term

This study aims to analyze the transmission mechanism of monetary policy in Indonesia in controlling inflation, both in terms of sharia and conventional terms. The data used in this empirical study is time series data during 2011:1-2017:4 originating from (Bank Indonesia), Financial Services Authority (FSA) and Ministry of Finance (Kemenkue). The analysis tool used is the Error Correction Model (ECM). This study analyzes the relationship between independent and dependent variables both in the short and long term. The results of this study throuht the asset prices indicate that from conventional monetary variable SBI (certifikat of bank indonesia) variables that have a positive and significant effect on inflation in the short-term. Where as in the long term the variable money supply has a positive effect and variable interest rates on Bank Indonesia, bonds have a positive and significant effect on inflation. In Islamic monetary variables, SBIS have a positive and significant effect on inflation in the short-term. Islamic bond variables (Sukuk) have a negative and significant effect on inflation in the short-term. While in the long-term the variable money supply, Islamic interest rates, and Islamic bonds have a positive and significant effect on inflation.

scholarly journals THE ANALYSIS OF THE TRANSMISSION MECHANISM OF MONETARY POLICY IN CONVENTIONAL AND SHARIA AGAINST INFLATION IN INDONESIA

2021 ◽  
Vol 9 (1) ◽  
pp. 46
Author(s):  
Julika Rahma Siagian
Keyword(s):  
Monetary Policy ◽  
Interest Rates ◽  
Money Supply ◽  
Financial Services ◽  
Time Series Data ◽  
Transmission Mechanism ◽  
Series Data ◽  
Analysis Tool ◽  
Short Term

This study aims to analyze the transmission mechanism of monetary policy in Indonesia in controlling inflation, both in terms of sharia and conventional terms. The data used in this empirical study is time series data during 2011:1-2017:4 originating from (Bank Indonesia), Financial Services Authority (FSA) and Ministry of Finance (Kemenkue). The analysis tool used is the Error Correction Model (ECM). This study analyzes the relationship between independent and dependent variables both in the short and long term. The results of this study throuht the asset prices indicate that from conventional monetary variable SBI (certifikat of bank indonesia) variables that have a positive and significant effect on inflation in the short-term. Where as in the long term the variable money supply has a positive effect and variable interest rates on Bank Indonesia, bonds have a positive and significant effect on inflation. In Islamic monetary variables, SBIS have a positive and significant effect on inflation in the short-term. Islamic bond variables (Sukuk) have a negative and significant effect on inflation in the short-term. While in the long-term the variable money supply, Islamic interest rates, and Islamic bonds have a positive and significant effect on inflation.

scholarly journals Nominal Interest Rate, Inflation Money and Market Link in Bangladesh: An Econometric Analysis

2020 ◽  
Vol 7 (1) ◽  
pp. 59-68
Author(s):  
Sanjida Akter Chowdhury ◽  
Md. Yousuf ◽  
Md. Nezum Uddin ◽  
Mohammed Jashim Uddin
Keyword(s):  
Interest Rate ◽  
Interest Rates ◽  
Time Series Data ◽  
Money Market ◽  
Nominal Interest Rate ◽  
Series Data ◽  
Short Term ◽  
Nominal Interest Rates ◽  
Fisher Hypothesis

This paper pursues to establish a connection among the nominal interest rate, the money market, and the inflation rate in Bangladesh using monthly time series data from June 2005 to March 2019. Because some data are stationary at the level and others are stationary at the 1st difference, the ARDL model is applicable for checking the link. There is a strong positive short-term and long-term relationship between inflation and nominal interest rates, suggesting that Bangladeshi data support the Fisher hypothesis for that time. For this study, the T bill, the call money rate is used as a measure of the money market. The research indicates that regulators should concentrate on call money rates in short-term and T-bill and call money rates in the long-term to control Bangladesh's nominal interest rate.

scholarly journals HOW TENURE OF SUKUK ISSUANCES IMPACTS THE ECONOMIC GROWTH IN MALAYSIA?

2019 ◽  
Vol 1 (1) ◽  
pp. 01-12
Author(s):  
Siti Sarah Mohd Zaki Fadzil ◽  
Noraziah Che Arshad
Keyword(s):  
Economic Growth ◽  
Central Bank ◽  
Positive Relationship ◽  
Time Series Data ◽  
Negative Relationship ◽  
Unit Root Test ◽  
Series Data ◽  
Short Term ◽  
The Impact

The present paper analyses the impact of Sukuk issuances on the economic growth of Malaysia over a period of 10 years from 2008 to 2017 on a yearly basis. There are six different types of Sukuk issuances which includes the long-term government/treasury/central bank (LGTC), long-term corporate (LCTE), long-term agency (LAGY), short-term government/treasury/central bank (SGTC), short-term corporate (SCTE) and short-term agency (SAGY) with the presences of the moderating variable which is the exchange rate (ER). The 10 years’ time-series data were analyzed by using the diagnostic test, unit root test and multiple regression analysis. The outcome of the study indicates that the presence of the ER, LCTE, SGTC, SCTE, and SAGY found to have a significant and positive relationship with the economic growth (GDP) of Malaysia. However, LGTC found not to be significant but shows a positive relationship with the GDP in Malaysia, whilst LAGY is found to be significant but shows a negative relationship with the GDP in Malaysia. Therefore, the Sukuk issuances give an impact on the economic growth of Malaysia, whereby with the presences of the moderating variable, the long-term and short-term Sukuk issuances can spur the economic growth of Malaysia.

Economic Turmoil in Islamic Banking Investment

ETIKONOMI ◽  
2020 ◽  
Vol 19 (2) ◽  
Author(s):  
Budiandru Budiandru ◽  
Sari Yuniarti
Keyword(s):  
Interest Rates ◽  
Stock Price ◽  
Time Series Data ◽  
Series Data ◽  
Islamic Banking ◽  
Vector Error Correction ◽  
Investment Financing ◽  
Vector Error ◽  
Operational Activities

Investment financing is one of the operational activities of Islamic banking to encourage the real sector. This study aims to analyze the effect of economic turmoil on investment financing, analyze the response to investment financing, and analyze each variable's contribution in explaining the diversity of investment financing. This study uses monthly time series data from 2009 to 2020 using the Vector Error Correction Model (VECM) analysis. The results show that the exchange rate, inflation, and interest rates significantly affect Islamic banking investment financing in the long term. The response to investment financing is the fastest to achieve stability when it responds to shocks to the composite stock price index. Inflation is the most significant contribution in explaining diversity in investment financing. Islamic banking should increase the proportion of funding for investment. Customers can have a larger business scale to encourage economic growth, with investment financing increasing.JEL Classification: E22, G11, G24How to Cite:Budiandru., & Yuniarti, S. (2020). Economic Turmoil in Islamic Banking Investment. Etikonomi: Jurnal Ekonomi, 19(2), xx – xx. https://doi.org/10.15408/etk.v19i2.17206.

scholarly journals Assessing Stream-Aquifer Connectivity in a Coastal California Watershed

Water ◽  
2021 ◽  
Vol 13 (4) ◽  
pp. 416
Author(s):  
Bwalya Malama ◽  
Devin Pritchard-Peterson ◽  
John J. Jasbinsek ◽  
Christopher Surfleet
Keyword(s):  
Time Series ◽  
Spectral Analysis ◽  
Water Level ◽  
Time Series Data ◽  
Series Data ◽  
Low Permeability ◽  
Pumping Tests ◽  
Stream Flows ◽  
The Impact

We report the results of field and laboratory investigations of stream-aquifer interactions in a watershed along the California coast to assess the impact of groundwater pumping for irrigation on stream flows. The methods used include subsurface sediment sampling using direct-push drilling, laboratory permeability and particle size analyses of sediment, piezometer installation and instrumentation, stream discharge and stage monitoring, pumping tests for aquifer characterization, resistivity surveys, and long-term passive monitoring of stream stage and groundwater levels. Spectral analysis of long-term water level data was used to assess correlation between stream and groundwater level time series data. The investigations revealed the presence of a thin low permeability silt-clay aquitard unit between the main aquifer and the stream. This suggested a three layer conceptual model of the subsurface comprising unconfined and confined aquifers separated by an aquitard layer. This was broadly confirmed by resistivity surveys and pumping tests, the latter of which indicated the occurrence of leakage across the aquitard. The aquitard was determined to be 2–3 orders of magnitude less permeable than the aquifer, which is indicative of weak stream-aquifer connectivity and was confirmed by spectral analysis of stream-aquifer water level time series. The results illustrate the importance of site-specific investigations and suggest that even in systems where the stream is not in direct hydraulic contact with the producing aquifer, long-term stream depletion can occur due to leakage across low permeability units. This has implications for management of stream flows, groundwater abstraction, and water resources management during prolonged periods of drought.

Welfare Use in Japan: Trends and Determinants

2007 ◽  
pp. 88
Author(s):  
Wataru Suzuki ◽  
Yanfei Zhou
Keyword(s):  
Time Series ◽  
Longitudinal Data ◽  
Time Series Data ◽  
Positive Impact ◽  
Series Data ◽  
Negative Effects ◽  
Long Time ◽  
Welfare Use ◽  
The Impact

This article represents the first step in filling a large gap in knowledge concerning why Public Assistance (PA) use recently rose so fast in Japan. Specifically, we try to address this problem not only by performing a Blanchard and Quah decomposition on long-term monthly time series data (1960:04-2006:10), but also by estimating prefecturelevel longitudinal data. Two interesting findings emerge from the time series analysis. The first is that permanent shock imposes a continuously positive impact on the PA rate and is the main driving factor behind the recent increase in welfare use. The second finding is that the impact of temporary shock will last for a long time. The rate of the use of welfare is quite rigid because even if the PA rate rises due to temporary shocks, it takes about 8 or 9 years for it to regain its normal level. On the other hand, estimations of prefecture-level longitudinal data indicate that the Financial Capability Index (FCI) of the local government2 and minimum wage both impose negative effects on the PA rate. We also find that the rapid aging of Japan's population presents a permanent shock in practice, which makes it the most prominent contribution to surging welfare use.

Does Public Debt Service Expenditure Crowd-Out Economic Growth? Empirical Evidence from an African Developing Country

2019 ◽  
Vol 64 (3) ◽  
pp. 23-38
Author(s):  
Talknice Saungweme ◽  
Nicholas M. Odhiambo
Keyword(s):  
Economic Growth ◽  
Public Debt ◽  
Time Series Data ◽  
Policy Formulation ◽  
Debt Service ◽  
Series Data ◽  
Long Run ◽  
Short Run ◽  
The Impact

Abstract This paper contributes to the ongoing debate on the impact of public debt service on economic growth; and it provides an evidence-based approach to public policy formulation in Zimbabwe. The empirical analysis was performed by applying the autoregressive distributed lag (ARDL) technique to annual time-series data from 1970 to 2017. The study findings reveal that the impact of public debt service on economic growth in Zimbabwe is negative in the short run but positive in the long run. The results are suggestive of the existence of a crowding-out effect of public debt service in Zimbabwe in the short run and a crowding-in effect in the long run. In view of these findings, the government should consider fiscal and financial policies that promote a constant supply of long-term finance, long-term fixed investments, and extension of a government securities maturity structure so as to ensure sustainable short- and long-term public debt service expenditures. The study further recommends the strengthening of non-distortionary revenue mobilisation reforms to reduce market distortions and boost domestic investment.

scholarly journals THE TESTING OF MONEY NEUTRALITY IN ECONOMIC GROWTH OF INDONESIA

2017 ◽  
Vol 1 (1) ◽  
pp. 12
Author(s):  
Muammil Sun’an ◽  
Amran Husen
Keyword(s):  
Economic Growth ◽  
Time Series Data ◽  
Output Growth ◽  
Broad Sense ◽  
Series Data ◽  
Analysis Tool ◽  
Real Sector ◽  
Short Term ◽  
Correction Model

<p>This study aim is to test the money neutrality in a narrow sense (M1) and a broad sense (M2) to the growth of output (GDP) in Indonesia, both in short term and long term. This research uses quarterly time series data at 2010 - 2016 periods. The analysis tool used is Error Correction Model (ECM). The results show that short-term money supply (M1 and M2) affect on output growth. However, in the long term, only money circulation in a broad sense (M2) affects on output growth, which also means that money is not neutral because it affects the real sector (GDP).</p><p> <strong>Keywords:</strong> M1, M2, Population, Capital, and Economic Growth.</p>

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