TY - JOUR
T1 - Transparency in the central bank and the mechanism of transmission of interest rates
T2 - Case study of AsiaPacific countries
AU - Wibowo, Wisnu
AU - Rosyidah, Adilah Ayu
N1 - Publisher Copyright:
© 2020 Primrose Hall Publishing Group.
PY - 2020
Y1 - 2020
N2 - This study aims to determine how the impact of transparency in the central bank in monetary policy transmission mechanism through interest rates can influence the ultimate goal in the form of price stability. The results of this study can also be used to determine whether monetary policy that uses interest rates affects the rate of inflation occurring in countries in the Asia-Pacific region, as well as to see whether the monetary policy transmission mechanism can be used in accordance with the theory of transmission mechanism through the interest rate. Panel data were collected yearly from 1998-2014 and estimated using PVAR (Panel Vector Auto Regression) analysis method. The results of this study indicate that the monetary policy transmission mechanism used in the Asia-Pacific region proves to be relevant to the theory of transmission mechanisms through the interest rate channel. The ultimate goal of price stability is also proven to be achieved. The result is shown by the result of estimation from PUAB interest rate and lending rate which proved to be a statistically significant negatively affect the inflation rate. Meanwhile, based on the results of impulse response, this study found that the existence of central bank transparency causes fluctuating inflation rate.
AB - This study aims to determine how the impact of transparency in the central bank in monetary policy transmission mechanism through interest rates can influence the ultimate goal in the form of price stability. The results of this study can also be used to determine whether monetary policy that uses interest rates affects the rate of inflation occurring in countries in the Asia-Pacific region, as well as to see whether the monetary policy transmission mechanism can be used in accordance with the theory of transmission mechanism through the interest rate. Panel data were collected yearly from 1998-2014 and estimated using PVAR (Panel Vector Auto Regression) analysis method. The results of this study indicate that the monetary policy transmission mechanism used in the Asia-Pacific region proves to be relevant to the theory of transmission mechanisms through the interest rate channel. The ultimate goal of price stability is also proven to be achieved. The result is shown by the result of estimation from PUAB interest rate and lending rate which proved to be a statistically significant negatively affect the inflation rate. Meanwhile, based on the results of impulse response, this study found that the existence of central bank transparency causes fluctuating inflation rate.
KW - Central bank transparency
KW - Inflation rate
KW - Monetary policy transmission mechanism
KW - PUAB interest rate channel
KW - PVAR
UR - http://www.scopus.com/inward/record.url?scp=85082201770&partnerID=8YFLogxK
M3 - Article
AN - SCOPUS:85082201770
SN - 2201-1315
VL - 11
SP - 451
EP - 475
JO - International Journal of Innovation, Creativity and Change
JF - International Journal of Innovation, Creativity and Change
IS - 9
ER -