Impact of Monetary Policy on Performance of Dhaka Stock Exchange

Mohotarema Rashid and Ummay Mahima Ima
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Mohotarema Rashid: Bangladesh Army University of Science and Technology, Bangladesh
Ummay Mahima Ima: angladesh University of Professionals, Dhaka- 1216, Bangladesh

International Journal of Science and Business, 2020, vol. 4, issue 10, 121-127

Abstract: This paper investigates the effect of monetary variables on the performance of stock market of Bangladesh using yearly data over the period of year 2008 to 2019. The objective of the study is to consider the effectiveness and consequences of different monetary variables on stock market of Bangladesh. As a dependent variable DSEX index has been used as a proxy variable for stock market performance and three independent variables repo rate, inflation rate, money market rate has been used as proxy of monetary variables. An ordinary least square method shows that 1% increase in money market rate, repo rate, and inflation rate the index value is decreased by 3.30%,1.20% and increased by 1.90% respectively. So this is suggested that investor should consider the above variables to make strategic decisions about portfolio and investment management.

Keywords: Monetary variables; DSEX; Stock market; Inflation; Repo rate (search for similar items in EconPapers)
Date: 2020
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