scholarly journals The Impact of Monetary Policy on Lending and Deposit Rates in Pakistan: Panel Data Analysis

2011 ◽  
Vol 16 (Special Edition) ◽  
pp. 199-213 ◽  
Author(s):  
Hasan Muhammad Mohsin
Keyword(s):  
Monetary Policy ◽  
Data Analysis ◽  
Discount Rate ◽  
Panel Data Analysis ◽  
Deposit Rate ◽  
Long Run ◽  
Significant Difference ◽  
Pass Through ◽  
The Impact ◽  
Effectiveness Of Monetary Policy

This study estimates the impact of monetary policy on lending and deposit rates in Pakistan, using bank data for the period November 2001 to March 2011. We find evidence of a long-run relationship between the lending and discount rate, but the deposit rate is not co-integrated, and the pass-through is not complete. The study finds that, overall, banks pass on only 20 percent of the impact of a change in the discount rate to lenders in the first month. There is also a significant difference among various banks’ pass-through rates. A shortrun analysis reveals that the pass-through of the deposit rate is low at 0.16, which implies that the effectiveness of monetary policy is limited in Pakistan.

Symmetric and asymmetric adjustment of bank deposit interest rates: empirical evidence from Kenya

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Moses Nzuki Nyangu ◽  
Freshia Wangari Waweru ◽  
Nyankomo Marwa
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Interest Rates ◽  
Asymmetric Adjustment ◽  
Deposit Rate ◽  
Content Type ◽  
Long Run ◽  
Adjustment Speed ◽  
Short Run ◽  
Pass Through

PurposeThis paper examines the sluggish adjustment of deposit interest rate categories with response to policy rate changes in a developing economy.Design/methodology/approachSymmetric and asymmetric error correction models (ECMs) are employed to test the pass-through effect and adjustment speed of deposit rates when above or below their equilibrium levels.FindingsThe findings reveal an incomplete pass-through effect in both the short run and long run while mixed results of symmetric and asymmetric adjustment speed across the different deposit rate categories are observed. Collusive pricing arrangement behavior is supported by deposit rate categories that adjust more rigidly upwards than downwards, while negative customer reaction behavior is supported by deposit rate categories that adjust more rigidly downwards than upwards.Practical implicationsEven though the findings indicate an aspect of increased responsiveness over the period, the sluggish adjustment of deposit rates imply that monetary policy is still ineffective and not uniform across the different deposit rate categories.Originality/valueTo the best of the authors' knowledge, this is the first study to empirically examine both symmetric and asymmetric adjustment behavior of deposit interest rate categories in Kenya. The findings are key to policy makers as they provide insights on how long it takes to adjust different deposit rate categories to monetary policy decisions. In addition, the behavior of deposit rates partly explains why interest rates capping was imposed in Kenya in 2016.

Effects of content characteristics on stages of customer engagement in social media: investigating European wine brands

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Aspasia Vlachvei ◽  
Ourania Notta ◽  
Eirini Koronaki
Keyword(s):  
Social Media ◽  
Data Analysis ◽  
Panel Data ◽  
Panel Data Analysis ◽  
Customer Engagement ◽  
Content Type ◽  
Interactive Engagement ◽  
Long Run ◽  
Three Stages ◽  
The Impact

PurposeThis study advances knowledge of interactive marketing strategies by examining the effect of different content types on the three stages of customer engagement (CE) in social media, namely, relationship formation, engagement creation and engagement contribution, for European wine brands.Design/methodology/approachBoth quantitative and qualitative content analyses are conducted; a panel data analysis validates the impact of content type on the three stages of CE in social media.FindingsThe results indicate that remunerative content is the most consistent and promising strategy for enhancing all three stages of CE in social media. Social content motivates consumers to interact with wine brands by commenting, which is the most demanding and time-consuming form of engagement.Practical implicationsThe empirical results offer valuable directions for managers and marketers of European wine brands on creating and maintaining optimal interactive engagement in all three stages with their Facebook communities over the long run.Originality/valueThis study is one of the first to empirically examine, through objective measurement, how content type affects the three stages of CE in social media. The case of European wine brands is examined, over time, through a panel data analysis.

scholarly journals Bank Characteristics Effect on Capital Structure: Evidence from PMG and CS-ARDL

2020 ◽  
Vol 13 (12) ◽  
pp. 310
Author(s):  
Ahmet Erülgen ◽  
Husam Rjoub ◽  
Ahmet Adalıer
Keyword(s):  
Capital Structure ◽  
Causal Relationship ◽  
Panel Data Analysis ◽  
Hierarchy Theory ◽  
Percentage Increase ◽  
Deposit Rate ◽  
Distributed Lag ◽  
Long Run ◽  
Short Run ◽  
The Impact

The main aim of this paper was to investigate the impact of bank characteristics on capital structure empirically. The study employed a panel data analysis, Pooled Mean Group (PMG) and Cross-Sectionally Augmented Autoregressive Distributed Lag (CS-ARDL) estimators were utilized, for the period spans between the years 2008 and 2018. Both the borrowing (leverage) ratio and equity ratio used in the analysis cover short-term deposits and long-term deposits as a fundamental determinant variable on the capital structure. The main findings confirm that the deposit ratio has a positive relationship with the size of the bank. In other words, big banks use more foreign sources than small banks to use the tax shield advantage. At the same time, a percentage increase in bank size and liquidity ratio enhance the bank deposit rate by 0.0068% and 0.479%, respectively, in the long-run, while a percentage change in interest income coverage will reduce the bank deposit rate by 0.004% in the long-run. Meanwhile, the significant causal relationship of growth rate with the bank deposit rate could not be established. In addition, the short-run coefficients of the variables reveal that size, interest coverage, and liquidity have a positive and significant causal relationship with bank deposit rate in the short-run. The findings of the study are in line with the results of capital structure theories, especially the hierarchy theory and balancing theory.

Pass-through of Change in Policy Interest Rate to Market Rates

2008 ◽  
Vol 47 (4II) ◽  
pp. 661-674
Author(s):  
M. Idrees Khawaja ◽  
Sajawal Khan
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Cost Of Capital ◽  
Weighted Average ◽  
Pass Through ◽  
The Cost ◽  
Lag Structure ◽  
The Impact ◽  
Effectiveness Of Monetary Policy ◽  
Policy Interest

Monetary policy has been aggressively used by the central Bank of Pakistan, in this decade, first to bolster growth and then to contain rampant inflation. Despite the sufficiently tight monetary policy that has remained in vogue in recent times, the inflation is still around 20 percent. This has raised questions about the effectiveness of monetary policy. One possible reason for the lesser effectiveness, if not failure, of monetary policy in taming inflation could be that in recent times, inflation was primarily supply driven and that the monetary tightening was in part offset by fiscal expansion, on the back of heavy bank borrowing by the government. However one cannot rule out the possibility that market imperfections might have also impeded the effectiveness of monetary policy in taming inflation to the desired extent. Incomplete and slow pass through of changes in policy interest rate to deposit rate and lending rate is a kind of imperfection that constrains the effectiveness of monetary policy. This study examines the pass through of policy interest rate to different market rates. Monetary theory predicts that the change in policy interest rate influences the cost capital which in turn influences consumption, savings, investments, and hence output. However if the impact of the change in policy rate on the cost of capital is less than one for one or if the change in policy rate fails to influence the cost capital immediately then the impact on output would become visible only with a certain lag and the impact would be less than one for one. This implies that if for example only 70 percent of the change in policy rate is passed on to cost of capital, then to manage an increase of 100 basis points in cost capital the policy rate should be raised by 143 basis points. This example serves to emphasise that for effective monetary management knowledge of the magnitude of passthrough of policy rate and the lag structure with which the policy rate influences cost of capital is important. Substantive empirical evidence confirms that changes in policy interest rate are transmitted to the output with a certain lag and that the pass-through of changes in policy rate to output or to other elements of the transmission channel may be less than one for one. Given the policy implications of the information, on the magnitude of pass through and the lag structure with which the policy rate influences different market rates, this Paper seeks to measure the pass-through of the changes in six month Treasury bill rate to six month KIBOR, six month weighted average deposit rate and weighted average lending rate. The study is focused on Pakistan.

scholarly journals Interest Rate Pass-Through: Empirical Study Towards Monetary Policy Transmission Effectiveness in Indonesia

2018 ◽  
Vol 2 (02) ◽  
pp. 14
Author(s):  
Heni Hasanah
Keyword(s):  
Monetary Policy ◽  
Interest Rate ◽  
Central Bank ◽  
Monetary Policy Transmission ◽  
Deposit Rate ◽  
Policy Transmission ◽  
Lending Rate ◽  
Pass Through ◽  
Effectiveness Of Monetary Policy

<p><em>This research aims to measure the effectiveness of monetary policy transmission, especially through the interest rate channel. The analysis was conducted on the first stage of its transmission, namely Interest Rate Pass-through (IRPT). IRPT refers to condition in which retail interest rate (both deposit and lending rate) responds to changes in policy rate of central bank. IRPT was measured using Error Correction Model (ECM) for time series data in the period of January 2010 - December 2015. The results of this study indicated that degree of long term and short term IRPT is incomplete for deposit and lending rate. In addition, IRPT for deposit rate is higher than lending rate, but the adjustment process of lending rate faster than deposit rate. Finally, model that include other variables (macroeconomic and internal banking indicator) generate long term IRPT which is smaller than the standard model. This results implies that the Central Bank, the FSA, and government needs to pay attention to the stability of the other variables that may interfere or reduce the effectiveness of monetary policy through the interest channel.     </em></p><p><strong><em>JEL Classification: </em></strong>E42, E43, E52</p><strong><em>Keywords: </em></strong><em>Deposit rate, ECM,  IRPT, Lending Rate, Policy Rate</em>

scholarly journals Analysis of Monetary Policy and its Impact on Indian Economy

2020 ◽  
Vol 9 (4) ◽  
pp. 355-360
Keyword(s):  
Monetary Policy ◽  
Direct Investment ◽  
Price Stability ◽  
Indian Economy ◽  
Long Run ◽  
Short Run ◽  
Independent Variable ◽  
Repo Rate ◽  
The Impact ◽  
Effectiveness Of Monetary Policy

Monetary policy matters for growth both in the short-run and long-run. This study focuses on theevaluation of monetarypolicyandits impact on Indian economy. Via monitoring the level of money supply, the central bank strives to protect price stability. The study is done using various indicators and factors such as Gross domestic product as dependent variable and repo rate, reverse repo rate, unemployment, Foreign direct investment and inflation as independent variable. Using these variables, it was found out that the economy of a nation is totally dependent on these factors. The parameter of calculating GDP was different. The objective of the research is to know effectiveness of monetary policy in India and to analyze the impact of selected monetary instruments on Indian Economy.

The influence of inflation targeting on the pass-through effect of the exchange rate

2018 ◽  
pp. 70-84
Author(s):  
Ph. S. Kartaev ◽  
Yu. I. Yakimova
Keyword(s):  
Developing Countries ◽  
Monetary Policy ◽  
Exchange Rate ◽  
Inflation Targeting ◽  
Policy Regime ◽  
Short And Long Term ◽  
The Exchange Rate ◽  
Pass Through ◽  
The Impact

The paper studies the impact of the transition to the inflation targeting regime on the magnitude of the pass-through effect of the exchange rate to prices. We analyze cross-country panel data on developed and developing countries. It is shown that the transition to this regime of monetary policy contributes to a significant reduction in both the short- and long-term pass-through effects. This decline is stronger in developing countries. We identify the main channels that ensure the influence of the monetary policy regime on the pass-through effect, and examine their performance. In addition, we analyze the data of time series for Russia. It was concluded that even there the transition to inflation targeting led to a decrease in the dependence of the level of inflation on fluctuations in the ruble exchange rate.

Household and Population-Level Behavioural Changes Due to COVID-19 Pandemic: A Smart Thermostat Based Comparative Data Analysis

2021 ◽  
Vol 10 (1) ◽  
pp. 1-6
Author(s):  
Kirti Sundar Sahu ◽  
Arlene Oetomo ◽  
Niloofar Jalali ◽  
Plinio P. Morita
Keyword(s):  
Data Analysis ◽  
Population Level ◽  
World Health ◽  
Motion Sensors ◽  
Household Level ◽  
Work From Home ◽  
Significant Difference ◽  
Health Organization ◽  
Smart Thermostat ◽  
The Impact

The World Health Organization declared the coronavirus outbreak as a pandemic on March 11, 2020. To inhibit the spread of COVID-19, governments around the globe, including Canada, have implemented physical distancing and lockdown measures, including a work-from-home policy. Canada in 2020 has developed a 24-Hour Movement Guideline for all ages laying guidance on the ideal amount of physical activity, sedentary behaviour, and sleep (PASS) for an individual in a day. The purpose of this study was to investigate changes on the household and population-level in lifestyle behaviours (PASS) and time spent indoors at the household level, following the implementation of physical distancing protocols and stay-at-home guidelines. For this study, we used 2019 and 2020 data from ecobee, a Canadian smart Wi-Fi thermostat company, through the Donate Your Data (DYD) program. Using motion sensors data, we quantified the amount of sleep by using the absence of movement, and similarly, increased sensor activation to show a longer duration of household occupancy. The key findings of this study were; during the COVID-19 pandemic, overall household-level activity increased significantly compared to pre-pandemic times, there was no significant difference between household-level behaviours between weekdays and weekends during the pandemic, average sleep duration has not changed, but the pattern of sleep behaviour significantly changed, specifically, bedtime and wake up time delayed, indoor time spent has been increased and outdoor time significantly reduced. Our data analysis shows the feasibility of using big data to monitor the impact of the COVID-19 pandemic on the household and population-level behaviours and patterns of change.

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