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The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone

The paper is aimed at investigating empirically, the impact of exchange rate on inflation and the extent of its asymmetry. The econometrics tool of analysis utilized by this study is Autoregressive Distributed Lag Model (ARDL) and Non-linear ARDL (NARDL) using time series data of Sierra Leone for a...

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Main Authors: Danlami, Ibrahim Abdulhamid, Hidthiir, Mohamad Helmi, Hassan, Sallahuddin
Format: Article
Language:English
Published: UUM Press 2019
Subjects:
HG Finance
Online Access:https://repo.uum.edu.my/id/eprint/30050/1/GBMR%2011%2001%202019%2063-82.pdf
https://doi.org/10.32890/gbmr2019.11.1.9318
https://repo.uum.edu.my/id/eprint/30050/
https://e-journal.uum.edu.my/index.php/gbmr/article/view/9318
https://doi.org/10.32890/gbmr2019.11.1.9318
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spelling my.uum.repo.300502023-11-28T11:53:45Z https://repo.uum.edu.my/id/eprint/30050/ The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone Danlami, Ibrahim Abdulhamid Hidthiir, Mohamad Helmi Hassan, Sallahuddin HG Finance The paper is aimed at investigating empirically, the impact of exchange rate on inflation and the extent of its asymmetry. The econometrics tool of analysis utilized by this study is Autoregressive Distributed Lag Model (ARDL) and Non-linear ARDL (NARDL) using time series data of Sierra Leone for a period 1970 - 2016. The results of the ARDL indicated that the exchange rate is inflationary but only in the short-run. There is no evidence of the long- run influence of exchange rate on inflation in the country. Meanwhile, the results of the NARDL not only confirms the short-run inflationary of the positive shocks of the exchange rate, but it also signifies the disinflationary effect of the negative shocks during the long-run. The findings of the research are limited to Sierra Leone whose data were used, based on ARDL and NARDL as the econometrics techniques applied, on the countrys data from 1970 to 2016 as well as the variables that are chosen. This implies that devaluation of local currencies in Sierra Leone can immediately raise the level of prices of imported commodities, in particular, and immediately raise the level of inflation in the country in general, but such effects are limited to the short-run, while revaluation has a disinflationary effect in the long- run. UUM Press 2019 Article PeerReviewed application/pdf en cc4_by https://repo.uum.edu.my/id/eprint/30050/1/GBMR%2011%2001%202019%2063-82.pdf Danlami, Ibrahim Abdulhamid and Hidthiir, Mohamad Helmi and Hassan, Sallahuddin (2019) The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone. Global Business Management Review (GBMR), 11 (1). pp. 63-82. ISSN 2180-2416 https://e-journal.uum.edu.my/index.php/gbmr/article/view/9318 https://doi.org/10.32890/gbmr2019.11.1.9318 https://doi.org/10.32890/gbmr2019.11.1.9318
institution Universiti Utara Malaysia
building UUM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Utara Malaysia
content_source UUM Institutional Repository
url_provider http://repo.uum.edu.my/
language English
topic HG Finance
spellingShingle HG Finance
Danlami, Ibrahim Abdulhamid
Hidthiir, Mohamad Helmi
Hassan, Sallahuddin
The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone
description The paper is aimed at investigating empirically, the impact of exchange rate on inflation and the extent of its asymmetry. The econometrics tool of analysis utilized by this study is Autoregressive Distributed Lag Model (ARDL) and Non-linear ARDL (NARDL) using time series data of Sierra Leone for a period 1970 - 2016. The results of the ARDL indicated that the exchange rate is inflationary but only in the short-run. There is no evidence of the long- run influence of exchange rate on inflation in the country. Meanwhile, the results of the NARDL not only confirms the short-run inflationary of the positive shocks of the exchange rate, but it also signifies the disinflationary effect of the negative shocks during the long-run. The findings of the research are limited to Sierra Leone whose data were used, based on ARDL and NARDL as the econometrics techniques applied, on the countrys data from 1970 to 2016 as well as the variables that are chosen. This implies that devaluation of local currencies in Sierra Leone can immediately raise the level of prices of imported commodities, in particular, and immediately raise the level of inflation in the country in general, but such effects are limited to the short-run, while revaluation has a disinflationary effect in the long- run.
format Article
author Danlami, Ibrahim Abdulhamid
Hidthiir, Mohamad Helmi
Hassan, Sallahuddin
author_facet Danlami, Ibrahim Abdulhamid
Hidthiir, Mohamad Helmi
Hassan, Sallahuddin
author_sort Danlami, Ibrahim Abdulhamid
title The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone
title_short The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone
title_full The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone
title_fullStr The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone
title_full_unstemmed The Asymmetric Impact of Exchange Rate on the Inflation Rate in Sierra Leone
title_sort asymmetric impact of exchange rate on the inflation rate in sierra leone
publisher UUM Press
publishDate 2019
url https://repo.uum.edu.my/id/eprint/30050/1/GBMR%2011%2001%202019%2063-82.pdf
https://doi.org/10.32890/gbmr2019.11.1.9318
https://repo.uum.edu.my/id/eprint/30050/
https://e-journal.uum.edu.my/index.php/gbmr/article/view/9318
https://doi.org/10.32890/gbmr2019.11.1.9318
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score 13.211869

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