A VAR Analysis of Kenya's Monetary Policy Transmission Mechanism : How Does the Central Bank's REPO Rate Affect the Economy? /

This paper examines the impact of a monetary policy shock on output, prices, and the nominal effective exchange rate for Kenya using data during 1997-2005. Based on techniques commonly used in the vector autoregression literature, the main results suggest that an exogenous increase in the short-term...

Ausführliche Beschreibung

Bibliographische Detailangaben
1. Verfasser: Cheng, Kevin
Format: Zeitschrift
Sprache:English
Veröffentlicht: Washington, D.C. : International Monetary Fund, 2006.
Schriftenreihe:IMF Working Papers; Working Paper ; No. 2006/300
Online Zugang:Full text available on IMF
Beschreibung
Zusammenfassung:This paper examines the impact of a monetary policy shock on output, prices, and the nominal effective exchange rate for Kenya using data during 1997-2005. Based on techniques commonly used in the vector autoregression literature, the main results suggest that an exogenous increase in the short-term interest rate tends to be followed by a decline in prices and appreciation in the nominal exchange rate, but has insignificant impact on output. Moreover, the paper finds that variations in the short-term interest rate account for significant fluctuations in the nominal exchange rate and prices, while accounting little for output fluctuations.
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Beschreibung:1 online resource (26 pages)
Format:Mode of access: Internet
ISSN:1018-5941
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