11. The Effect of Exchange Rate and Oil Price on BIST Industrial Index: Cointegration and Causality Analysis
- Author:
- Serpil Sumer
- Publication Date:
- 05-2021
- Content Type:
- Journal Article
- Journal:
- Bilgi
- Institution:
- Sakarya University (SAU)
- Abstract:
- Industry is important for development and sustainability. Countries attach importance to industrialization in order to reduce their foreign dependency and gain competitiveness. It is expected that companies which competitiveness has increased with industrialization will have a positive effect on the national economy and financial markets. The raw materials used in the production process of the enterprises whose main activity is based on industry and the supply of these raw materials are among the issues that should be taken into consideration in industrial production. In this study, the relationship between oil price, exchange rate and Borsa Istanbul Industrial Production Index has been examined. In the study, Johansen co-integration and Granger causality tests were carried out using secondary data for the period January 2000 - September 2020. As a result of the Johansen co-integration test, it is concluded that there is a co-integration relationship between variables. As a result of Granger causality test; It was concluded that there is a bidirectional causality relationship between Borsa Istanbul industrial production index and exchange rate, and a racket effect causality relationship between Borsa Istanbul industrial production index and oil price. In addition, it is concluded that there is no causality relationship between exchange rate and oil price. The research of the relationship between the oil price and exchange rate of the industry, which has an important place in terms of economic growth and competition, is a feature that sets this study apart from other studies in the same field.
- Topic:
- Development, Oil, Industry, and Exchange Rates
- Political Geography:
- Turkey and Middle East