Relation entre Taux d’intérêt et Inflation en Algérie: 1990-2015 The Relationship Between Interest Rate and Inflation in Algeria: 1990-2015

Abstract

This study focuses on the relationship between inflation and nominal interest rate in Algeria, more commonly known as the "Fisher relationship", using quarterly data from the first quarter of 1990 to the last quarter of 2015. The econometric study concluded that there is a causal relationship between the two variables and a long run equilibrium relationship. The application of VAR has confirmed the results obtained by indicating that there is a long run relationship, but the effect of inflation on interest rates is higher than the effect of interest rate on inflation.