A standard study of the impact of exchange rate fluctuations on financial markets -Malaysia (2013 - 2019) model-

Abstract

The study deals with the problem of exchange rate fluctuations and its impact on financialmarkets, the studywasbased on a number of objectives, the most important of whichis to know the impact of the exchange rate fluctuations of the Malaysian ringgit on the general index of Kuala Lumpur priceslisted on the stock market of Malaysia. The ARDL model wasused to test the relationshipbetween the exchange rate and the generalprice index in Malaysia for the period (2013-2019).The results of the analysisrevealedthatthereis an inverse relationshipbetween the variables mentioned, movingfrom the exchange rate to the Kuala Lumpur index on the one hand, and from the index to the exchange rate on the other hand, and thisis consistent with the analyticalside of the study, and thus the possibility of considering the Kuala Lumpur index as a generalindicator on the direction of future economicactivity The results of the studyalsoshowedthat exchange rate fluctuations have a differenteffect in different directions on the index for the financialmarket over the long term.