The Effects of Exchange Rate and Interest Rate on Producer Prices in Turkey

The Effects of Exchange Rate and Interest Rate on Producer Prices in Turkey

Dr. Dilek Surekci Yamacli

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Nuh Naci Yazgan University

The Effects of Exchange Rate and Interest Rate on Producer Prices in Turkey

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Abstract

The aim of this study is to investigate the relations between exchange rate, interest rate and producer prices for 2004-2013 periods in Turkey. To the determine relationships between variables Johansen Co-Integration, Vector Error Correction, Granger Causality and Relative Sensitivity Analysis are used. According to results of the study; there are short and long-term relationships between exchange rate, interest rate and producer prices. Beside this, relationship between inflation and the exchange rate is higher than the interest rate. On the other hand, effect of the interest rate on the exchange rate is weak. These results can be interpreted as the interest rate has a low contribution in the production costs compared to that of the exchange rate for Turkey. Therefore, economic policies for stability in the exchange rate can be recommended such as increase in the exchange rate earnings and reducing expenses.

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Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

Data Availability

Not applicable for this article.

How to Cite This Article

Dr. Dilek Surekci Yamacli. 2016. \u201cThe Effects of Exchange Rate and Interest Rate on Producer Prices in Turkey\u201d. Global Journal of Management and Business Research - B: Economic & Commerce GJMBR-B Volume 16 (GJMBR Volume 16 Issue B7).

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GJMBR Volume 16 Issue B7

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Journal Specifications

Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

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GJMBR-B Classification JEL Code: D51

Submission ReceivedDecember 7, 2015
Peer Review Double Blind
Handling Editor
Accepted January 3, 2016
Published January 15, 2016

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December 20, 2016

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Article Matrices

Total Score: 106

Country: Turkey

Subject: Global Journal of Management and Business Research - B: Economic & Commerce

Authors: Dr. Dilek Surekci Yamacli (PhD/Dr. count: 1)

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