Efficient Market Hypothesis: Foreign Exchange Market of Bangladesh

Mahamuda Firoj and Sharmina Khanom
Additional contact information
Mahamuda Firoj: Department of Economics and Banking, International Islamic University Chittagong, Kumira, Chittagong - 4318, Bangladesh.
Sharmina Khanom: Department of Economics and Banking, International Islamic University Chittagong, Kumira, Chittagong - 4318, Bangladesh.

International Journal of Economics and Financial Issues, 2018, vol. 8, issue 6, 99-103

Abstract: Efficiency in a foreign exchange market (FEM) is very essential for a developing economy like Bangladesh as the foreign exchange rates play a critical role to determine the various macroeconomic policies and issues of an economy. Thus the main objective of this paper is to investigate the efficiency of the FEM of Bangladesh. Statistics that have worn in this paper comprises of nominal daily exchange rates (spot) of seven bilateral currency rates in opposition to the Bangladeshi currency Taka over the period 1st January 2010 to 30th November 2017 obtained from the website of Bangladesh Bank. The unit root test and the cointegration test are run by econometric software to look into the efficiency of the FEM of Bangladesh. The concluding findings indicate that all the seven exchange rates succeed the random walk hypothesis and this is the verification of the weak form of efficiency. Moreover, the cointegration scrutiny depicts there is no indication of the semi-strong form of efficiency in the FEM of Bangladesh.

Keywords: Foreign Exchange Market; Exchange Rate; Efficiency. (search for similar items in EconPapers)
JEL-codes: E44 F31 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.econjournals.com/index.php/ijefi/article/download/7097/pdf (application/pdf)
https://www.econjournals.com/index.php/ijefi/article/view/7097/pdf (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eco:journ1:2018-06-14

Access Statistics for this article

International Journal of Economics and Financial Issues is currently edited by Ilhan Ozturk

More articles in International Journal of Economics and Financial Issues from Econjournals
Bibliographic data for series maintained by Ilhan Ozturk ().