연구정보
[경제] Revisiting the Monetary Conditions Index for Bangladesh
방글라데시 국외연구자료 연구보고서 - Bangladesh Bank 발간일 : 2021-06-23 등록일 : 2022-01-27 원문링크
The monetary conditions index (MCI) combines the effect of interest rates and exchange rates in a single indicator and can be used for assessing the overall monetary policy stance. This paper attempts to construct MCI for Bangladesh for the period 2004 to 2020 using monthly data. The weights of interest rate and exchange rate are derived from the aggregate demand framework using Johansen’s cointegration techniques. Our estimated monetary conditions ratio is 1.86:1 implying that a 1.86 percent increase (depreciation) in the exchange rate or a 1.0 percentage point rise (100 basis points) in the interest rate has about the same effects over time on aggregate demand. That implies the interest rate channel is stronger than the exchange rate channel in influencing monetary conditions in Bangladesh. This paper is different from Younus (2012) which estimated the monetary condition ratio as 4.88:1 based on the inflation model, reflecting the interest rate channel was even stronger during 2004-2011. The obtained estimates of MCI using the weights of interest rate and exchange rate fairly track the light and soft episodes of monetary policy stance which suggests that in the observed period monetary policy in Bangladesh was mostly expansionary. Furthermore, the findings of the paper show the movements between MCI and inflation are broadly opposite, suggesting that cautious monetary policy might able to tame inflation to some extent. Thus MCI can be used as an indicator of monetary policy decision-making instrument alongside other indicators.
본 페이지에 등재된 자료는 운영기관(KIEP) 및 EMERiCs의 공식적인 입장을 대변하고 있지 않습니다.
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