UNDERSTANDING MARKET REACTION TO COVID-19 MONETARY AND FISCAL STIMULUS IN MAJOR ASEAN COUNTRIES

Syed Aun R. Rizvi, Solikin Juhro and Paresh Kumar Narayan ()
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Paresh Kumar Narayan: Monash Univerisity

Bulletin of Monetary Economics and Banking, 2021, vol. 24, issue 3, 313-334

Abstract: In this paper, we examine the effect of fiscal and monetary policy stimulus actions during the COVID-19 pandemic on the stock markets of four ASEAN countries, namely, Indonesia, Singapore, Malaysia, and Thailand. Using time-series regression models, we show the relative importance of monetary and fiscal policies. Our findings suggest that 7-days after the policy announcement, fiscal policies helped cushion financial market losses in Indonesia, Singapore and Thailand. We do not find any robust evidence of policy effectiveness for Malaysia. While our investigation is preliminary it opens an additional avenue for understanding the effectiveness of policy stimulus.

Keywords: Stimulus; Fiscal policy; Monetary policy; Stock returns (search for similar items in EconPapers)
JEL-codes: E44 E52 E62 I18 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:24:y:2021:i:3a:p:313-334

DOI: 10.21098/bemp.v24i3.1690

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