Can Sukuk Support Sustainable Development through Monetary Policy Transmission?

Suriani, Suriani; Masbar, Raja; Wahid, Nazaruddin A.; Majid, M. Shabri Abd.

doi:10.2991/agc-18.2019.98

Cited by 4 publications

(8 citation statements)

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“…Paltrinieri et al (2015) explained the benefits of sukuk diversification, sukuk correlation with other asset classes and the effects of inclusion of investment portfolios of institutional and retail investors through a comprehensive comparison of riskreturns profiles during and after the 2008 financial crisis. Finally, Suriani et al (2019) explored the influence of sukuk on sustainable development in Indonesia through asset price monetary policy transmission channel using a cointegration approach. They found a unidirectional relationship running from sukuk to inflation in the Indonesian economy.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Meanwhile, Selim (2015) only provided conceptual monetary policy channels without providing empirical evidence on the relevance of sukuk in monetary policy transmission. Finally, Suriani et al (2019) only investigated the asset pricing monetary channel of sukuk using a cointegration approach. They ignored the dynamic multivariate effect of the sukuk monetary transmission process through other channels, such as the exchange rate channel.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Previous studies have documented relationships between economic activities of investment, consumption and economic growth (Alper, 2018;Hismendi et al, 2021). In their studies, Suriani et al (2019) found that the sukuk market has been connected to inflation and economic growth. Sukuk is also found as one of the monetary policy instruments in stabilizing macroeconomic variables (Suriani et al, 2018;Al-Raeai et al, 2018).…”

Section: Asset Price and Exchange Rate Channelsmentioning

confidence: 99%

“…Inflation is documented to have a negative impact on economic growth (Kasidi and Mwakanemela, 2013). In their study on the role of sukuk as an alternative monetary policy instrument in Indonesia, Suriani et al (2019) revealed a unidirectional positive effect running from sukuk to economic growth.…”

Section: Introductionmentioning

confidence: 99%

“…Furthermore, Suriani et al (2019) explored the influence of sukuk on sustainable development in Indonesia through monetary policy transmission of asset price channels using a cointegration approach. They found a unidirectional causal relationship running Asset price and exchange rate channels from sukuk to inflation and economic growth.…”

Section: Introductionmentioning

confidence: 99%

See 4 more Smart Citations

Sukuk and monetary policy transmission in Indonesia: the role of asset price and exchange rate channels

Suriani

Majid

Masbar

et al. 2021

JIABR

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Purpose The purpose of this study is to empirically analyze the role of sukuk in the monetary policy transmission mechanism through the asset price and exchange rate channels in the Indonesian economy. Design/methodology/approach Using the monthly data from January 2003 to November 2017, this study uses a multivariate vector error correction model causality framework. To examine the role of sukuk in the monetary policy transmission mechanism through the asset price channel, this study uses the variables of consumption, inflation, interest rates, economic growth and the composite stock price index. Meanwhile, to examine the role of sukuk in the monetary policy transmission mechanism through the exchange rate channel, this study used variables of inflation, interest rates, economic growth, foreign investment and exchange rate. Findings This study documented that sukuk has no causal relationship with inflation through asset price and exchange rate channels. Nevertheless, sukuk has a bidirectional causal relationship with economic growth through asset price and exchange rate channels. Sukuk is also documented to have a causal relationship with monetary policy variables of interest rate and stock prices through asset price and exchange rate channels. Finally, a unidirectional causality is recorded running from the exchange rate to sukuk in the exchange rate channel. Research limitations/implications The finding of independence of the sukuk market from interest rates provides evidence that the trading of the sukuk in Indonesia has been in harmony with the Islamic tenets. Practical implications The relevant Indonesian authorities need to enhance both domestic and global sukuk markets as part of efforts to promote the sustainability of Islamic capital market development in Indonesia. Originality/value To the best of the authors’ knowledge, this study is among the first attempts to empirically investigate the role of sukuk in monetary policy transmission through asset price and exchange rate channels in the context of the Indonesian economy.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Asset Price and Exchange Rate Channelsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Sukuk and monetary policy transmission in Indonesia: the role of asset price and exchange rate channels

Suriani

Majid

Masbar

et al. 2021

JIABR

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Green Finance and Climate Change Nexus in Indonesia: Autoregressive Distributed Lag Approach

Suriani,

Masbar,

Khairul

et al. 2023

2023 International Conference on Decision Aid Sciences and Applications (DASA)

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The Influence of Advertising, Trust, and Word of Mouth on the Investment Decision of Government Sukuk

Febrina,

Nurwahidin

2024

FJSR

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This study analyzes the effects of advertising, trust, and word of mouth on the investment decisions of Government Sukuk. The population in this study are Government Sukuk investors. Based on the Hair formula, 115 respondents made up the sample. The sample research approach combines a purposive sampling strategy with a non-probability sampling technique. A questionnaire research instrument is used in a survey as part of the data collection process. techniques for partial least squares data processing. This research demonstrates that advertising has a positive and significant effect on investment decisions, trust has a positive and significant effect on investment decisions, and word of mouth has a positive and significant effect on investment decisions

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Can Sukuk Support Sustainable Development through Monetary Policy Transmission?

Cited by 4 publications

References 10 publications

Sukuk and monetary policy transmission in Indonesia: the role of asset price and exchange rate channels

Sukuk and monetary policy transmission in Indonesia: the role of asset price and exchange rate channels

Green Finance and Climate Change Nexus in Indonesia: Autoregressive Distributed Lag Approach

The Influence of Advertising, Trust, and Word of Mouth on the Investment Decision of Government Sukuk

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