The Relation between Stock Prices and Money Supply in Pakistan: An Investigation

Authors

  • Nawaz Ahmad SZABIST-Karachi
  • Fazal Husain SZABIST Karachi

DOI:

https://doi.org/10.31384/jisrmsse/2007.05.2.6

Keywords:

Money Supply, Stock returns, KSE 100 Index, monetary assets

Abstract

This paper examines the causal relationship between money supply and stock prices. The analysis indicates a long-run relationship between stock prices and money supply. The analysis further indicates unidirectional causality from Money Supply to KSE 100 Index both in the short run and in the long run. This implies that the stock market is not efficient with respect to M2 and past information regarding monetary assets can be helpful to predict movements in stock prices.

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Published

2007-12-31

How to Cite

Ahmad, N., & Husain, F. (2007). The Relation between Stock Prices and Money Supply in Pakistan: An Investigation. JISR Management and Social Sciences & Economics, 5(2), 30–32. https://doi.org/10.31384/jisrmsse/2007.05.2.6

Issue

Vol. 5 No. 2 (2007): JISR-MSSE

Section

Original Articles

License

Copyright (c) 2007 Author

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

Copyright: The Authors