Do interest rate, exchange rate effect stock returns? a Pakistani perspective

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Abstract

This study examines the relationship between stock return, interest rate and exchange rates in Pakistani economy. For this, the data of short term interest rate, exchange rate (Rs/US $) and stock market returns (KSE-100) over the period of 1998-2009 is collected. A multiple regression model is applied to test the significance of change in interest rate and exchange on stock returns. The results show that both the change in interest rate and change in exchange rate has a significant impact on stock returns over the sample period.

Original languageEnglish
Pages (from-to)146-150
Number of pages5
JournalInternational Research Journal of Finance and Economics
Issue number50
Publication statusPublished - 1 Oct 2010
Externally publishedYes

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