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the impact of monetary policy on general price level
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Our country, Madagascar, is one of the countries in the world experiencing persistent inflation. The aim of this study is to determine whether the money supply explains the general price level. This paper examines the relationship between the two. Analysis of numerical data from the Central Bank of Madagascar shows, through empirical analysis, that there is a causal relationship between the money supply and the general price level in the case of Madagascar. It indicates that an increase in the money supply in circulation leads to a rise in market prices, and it demonstrates an inverse relationship between the money supply and the exchange rate.
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Beschrijving
(1)
Our country, Madagascar, is one of the countries in the world experiencing persistent inflation. The aim of this study is to determine whether the money supply explains the general price level. This paper examines the relationship between the two. Analysis of numerical data from the Central Bank of Madagascar shows, through empirical analysis, that there is a causal relationship between the money supply and the general price level in the case of Madagascar. It indicates that an increase in the money supply in circulation leads to a rise in market prices, and it demonstrates an inverse relationship between the money supply and the exchange rate.
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