Macroeconomics and Monetary Economics

May Jin Theong · Ahmad Farid Osman · Su Fei Yap ·Institutions and Economies ·2018 ·JEL: E20; E32; E37; E44; E51; G21

Malaysia has one of the highest household debts relative to gross domestic product in the Asia region. High indebted households have negative net worth and prone to default even during mild shocks. In most economies including Malaysia, household loan default is dominated by mortgages. In Malaysia, however, credit card debt default rate has been growing faster than mortgage default rate. Thus, this paper analyses how combined global and domestic macroeconomic factors impact on credit card nonperforming loan (NPLs) in Malaysia. Estimates from the Autoregressive Distributed Lags (ARDL) model highlights that in the long run, credit card NPLs are procyclical as strong domestic real output reduces credit card default. The study shows positive global crude oil price shocks reduces the credit card NPLs while a stressed global financial market condition has a reverse effect on credit card NPLs. Further, consumer price index negatively relates to credit card NPLs while monetary policy affects NPLs whereby a cut back of the overnight policy rate reduces credit card debt default.

Nur Syazwani Mazlan · Farah Yushanis Fadzilah · Saifuzzaman Ibrahim ·Jurnal Ekonomi Malaysia ·2019

This paper examines the impact of globalisation on the level of human development in Malaysia. It also investigates the roles of other potential determinants of human development such as foreign direct investment (FDI), trade openness and international migration on Human Development Index (HDI) in Malaysia. We employ the method of Autoregressive Distributed Lag (ARDL) on the annual time series data covering the period from 1980 to 2017. The results confrm a positive and signifcant long run relationship between globalisation and FDI with HDI in Malaysia. However, the results imply a negative short and long run relationship of both trade openness and international migration with HDI. Therefore, the results suggest for policies to be focused and geared towards fostering globalisation and attracting the infows of FDI if the country’s main agenda is to improve the level of human development.

J. M. Shukri · Muzafar Shah Habibullah · Roseziahazni Abdul Ghani · M. A. M. Suhaily ·Jurnal Ekonomi Malaysia ·2021 ·JEL: E43, E52, F31, F32, F33, F41

The aim of this paper is to estimate the equilibrium of exchange rates and identify the roles of macroeconomics fundamentals affecting exchange rates using Malaysian data spanning 1970 to 2019. This study adopts the Autoregressive Distributed Lag model to examine the long-run relationships or cointegration among variables and the dynamic effect within variables in the short-run over the sample period. The results suggest that inflation rate and national income growth rate play important roles in influencing exchange rate movement. The results also reveal that the misalignment of exchange rates is quite small and stable during 1988 to 2019, except for 2015 which was attributed to the weaker growth in China. Consecutively, this study suggests that the parity condition is only important in the long-run in explaining exchange rates behaviour for the sample country.