Asymmetric effects of exchange rate on money demand in Thailand

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พบกานต์ อาวัชนาการ



Previous research assumed that exchange rate has symmetric effect on money demand. In this paper, the asymmetrical effects of real exchange rates on money demand are examined. In doing this, the money demand function in Thailand is estimated by using ARDL and NARDL approach over the period 2000q2-2018q2. The empirical results suggest that there is a cointegral relationship among real narrow money balances, real exchange rate, real GDP growth and the money market rates. Importantly, the asymmetric effects of any exchange rates changes are found. Furthermore, the NARDL approach is more appropriate to estimate the money demand function of Thailand than the ARDL approach. Based on empirical results, one policy implication is suggested that stabilizing exchange rate measures, for example, capital control and foreign exchange market intervention, are required for a stable money demand. These measures help to achieve the primary objective of price stability.

Keywords: 1) Money demand 2) ARDL approach 3) Non-linear ARDL approach 4) Thailand


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อาวัชนาการพ. (2019). Asymmetric effects of exchange rate on money demand in Thailand. Journal of Business, Economics and Communications, 14(3), 105-115. Retrieved from
บทความวิจัย (Research article)


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