Financial sector development and macroeconomic volatility: Case of the Southern African Development Community region

Kapingura, Forget Mingiri; Mkosana, Nwabisa; Kusairi, Suhal

doi:10.1080/23322039.2022.2038861

Cited by 8 publications

(4 citation statements)

References 52 publications

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“…This means that a strengthening Composite Stock Price Index (IHSG) attracts investors to switch from bond instruments to stocks, which potentially provide higher returns, thereby suppressing bond liquidity and causing the bid-ask spread to widen. This is consistent with previous research by (Kapingura et al, 2022) that the stock market's performance will have a negative impact on bond liquidity in the secondary market.…”

Section: Factors Affecting Sbsn Liquiditysupporting

confidence: 93%

Analysis on the Determinants of Republic of Indonesia Sovereign Sukuk Liquidity in Secondary Market

Pranata,

Rokhim

2024

devotion

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This study investigates the determinants of liquidity in Sharia Securities (SBSN) by analyzing the impact of bond-specific and macroeconomic factors on the bid-ask spread as a proxy for liquidity. Using panel data regression analysis, the study examines 62 tradable series of SBSN from 2013 to 2022, considering factors such as outstanding amount, time to maturity, yield to maturity, Rupiah exchange rate, inflation rate, reference interest rate, Indonesia Stock Exchange Composite Index (IHSG), and Indonesia Credit Default Swap (CDS). Results indicate that time to maturity, yield to maturity, central bank reference interest rate (BIRate), IHSG, and CDS significantly influence the bid-ask spread of SBSN, while outstanding amount, Rupiah exchange rate, and inflation rate do not. Additionally, analysis reveals that a strengthening IHSG and higher CDS widen the bid-ask spread, indicating reduced liquidity. These findings provide insights for stakeholders including issuers, investors, and regulators in managing SBSN liquidity in the Indonesian market.

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Section: Factors Affecting Sbsn Liquiditysupporting

confidence: 93%

Analysis on the Determinants of Republic of Indonesia Sovereign Sukuk Liquidity in Secondary Market

Pranata,

Rokhim

2024

devotion

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“…The capacity of a community/region is not an external factor, but is related to their development level [37,38]. Inappropriate socioeconomic conditions such as irregular settlement system, weak social awareness, lack of awareness of construction rules, weak economic capabilities, failure to comply with construction standards, etc.…”

Section: Capacity Of Local Communitiesmentioning

confidence: 99%

Resilience capacities to reduce the impacts of natural disasters (flood)

Amirsadat

Omidipoor²,

Bastaminia

et al. 2023

Preprint

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The purpose of this study is to investigate and evaluate resilience capacities to reduce the impacts of natural disasters (floods) in Konarak city. This study is applied research, which uses descriptive-analytical method to identify and measure dimensions and components resilience of Konarak city. The sample size was estimated using Cochran's formula of 371 households in four neighborhoods of Shomal nirogah gazi, Surak, Nazarabad and Jonoob shahr of Konarak city. To conduct research, first by using library sources, indicators and factors affecting social, economic, institutional, physical, environmental, health-sanitary and individual resilience were identified, and then the field methods and questionnaire were used to collect the required information.In order to analyze the data, the coefficient of multiple correlations such as multiple regression analyses and path analysis were used. The results showed that the level of resilience in the Konarak city is in the social dimension 48.70, economic 38.61, institutional 41.56, physical 31.20, environmental 34.12, health-sanitary 27.48 and individual dimension 39.12, which were in an unfavourable situation. The highest level of resilience is related to the neighbourhoods Shomal nirogah gazi and Surak with 40.95 and 37.81%, respectively, and the lowest level of resilience is for the neighborhoods Nazarabad and Jonoob shahr with 34.22 and 36.05%, respectively. Also, path analysis of resilience shows that in relation to the direct effects of resilience, the social dimension has the highest effect with (0.56) and the next ranks are the economic dimension with (0.51), the environmental dimension (0.41), and the physical dimension (0.39). ), the individual dimension (0.37), the institutional dimension (0.13) and the health-sanitary dimension with (0.10) have influenced the resilience of Konark city. Regarding the indirect effects, social resilience has the highest (0.43) and institutional dimension has the lowest (0.04) indirect impact on the resilience of the sample neighbourhoods of Konarak city.

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“…Gonzalez-Aguado (2018) models the impact of external and domestic shocks on output volatility and observes that FD decreases the susceptibility of emerging economies to external shocks. Kapingura et al (2022) used cross-sectionally augmented autoregressive distributed lag (CS-ARDL) to examine the impact of financial sector development on macroeconomic volatility in the case of the southern African development community between 1980 and 2018. The result of the study hints that banking variables and capital market development have significant adverse effects on growth volatilities; thus, financial development mitigates macroeconomic volatilities.…”

Section: Literature Reviewmentioning

confidence: 99%

External shocks and macroeconomic volatility in Nigeria: does financial development moderate the effect?

Abanikanda,

Dada

2023

PRR

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PurposeMotivated by the negative effect of external shocks on the domestic economy, this study explores the role of financial sector development in absorbing the effect of external shocks on macroeconomic volatility in Nigeria.Design/methodology/approachAutoregressive distributed lag and fully modify ordinary least square are used to examine the moderating effect of financial development in the link between external shocks and macroeconomic volatilities in Nigeria between 1986Q1 and 2019Q4. External shock is proxy using oil price shock, and financial development is proxy by domestic credit to the private sector and market capitalisation. At the same time, macroeconomic volatility is proxy by output and inflation volatilities. Macroeconomic volatilities are generated using generalised autoregressive conditional heteroskedasticity (GARCH 1,1).FindingsThe results indicate that domestic credit to the private sector significantly reduces output and inflation volatilities in Nigeria in the short and long run. However, market capitalisation promotes macroeconomic volatility. More specifically, financial development indicators play different roles in curtaining macroeconomic volatilities. The results also reveal that external shocks stimulate macroeconomic volatility in Nigeria in the short and long run. Nevertheless, the effects of external shocks on macroeconomic volatilities are reduced when the role of financial development is incorporated.Practical implicationsThis study, therefore, concludes that strong financial sector development serves as a significant shock absorber in reducing the adverse effect of external shock on the domestic economy.Originality/valueThis study contributes to the extant studies by introducing a country-specific analysis into the empirical examination of how financial development can moderate the influence of external shock on macroeconomic volatilities.

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Financial sector development and macroeconomic volatility: Case of the Southern African Development Community region

Cited by 8 publications

References 52 publications

Analysis on the Determinants of Republic of Indonesia Sovereign Sukuk Liquidity in Secondary Market

Analysis on the Determinants of Republic of Indonesia Sovereign Sukuk Liquidity in Secondary Market

Resilience capacities to reduce the impacts of natural disasters (flood)

External shocks and macroeconomic volatility in Nigeria: does financial development moderate the effect?

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