http://mail.asianonlinejournals.com/index.php/AJEER/issue/feed 2024-09-19T05:43:00+00:00 Open Journal Systems http://mail.asianonlinejournals.com/index.php/AJEER/article/view/5890 2024-08-17T12:20:30+00:00 Amr Hosny ahosny@imf.org

<p>This paper examines the global and domestic factors driving different investor holdings of local currency (LC) sovereign debt in Indonesia. Using an autoregressive distributed lag co-integration approach, using monthly data for Indonesia over 2002M12-2022M12, we find that non-resident holdings of LC debt in Indonesia are mostly driven by global factors such as commodity prices and volatility in global bond markets, while domestic investors (such as domestic banks and institutional investors) are mostly driven by higher debt security issuances and Bank of Indonesia (BI) acts as a residual financier under adverse conditions. We also find evidence that foreign investors follow the "benchmark effect" and are attracted by higher domestic yields. Results are mostly robust to&nbsp;different specifications. These results call for a further deepening of the investor base, especially domestic nonbanks, to support market depth and reduce volatility.</p>

2024-08-16T00:00:00+00:00 Copyright (c) 2024 http://mail.asianonlinejournals.com/index.php/AJEER/article/view/5959 2024-09-19T05:43:00+00:00 Shakil Ahmad de202160007@uibe.edu.cn Imran Maqbool imrmaqbool@hotmail.com Asif Raihan asifraihan666@gmail.com Liu Xin 202210110004@uibe.edu.cn

<p>This study investigates the short-term and long-term correlations between total imports in Pakistan and a set of explanatory variables. We utilized the Autoregressive Distributed Lag (ARDL) model, and we estimated the import demand function for the period from 1980 to 2021. The Augmented Dickey-Fuller (ADF) test confirmed that none of the variables exhibited second-order integration, ensuring their suitability for the ARDL approach. Bounds testing indicated the existence of a long-term equilibrium relationship among the included variables. Furthermore, diagnostic tests validated our model's statistical robustness, ensuring our findings' reliability. The long-term analysis shows significant relationships between imports and key economic indicators such as gross domestic product (GDP), the inflation rate, and the import demand function. Furthermore, we found a slight positive impact on import demand from the import price index and foreign direct investment (FDI). These results emphasize the included relationships between various macroeconomic factors and import demand in Pakistan. Based on these findings, we recommend that the government implement policies aimed at boosting investment, stimulating economic growth, and controlling inflation. Specifically, policies that target enhancing foreign direct investment (FDI), maintaining stable inflation rates, and promoting economic growth will be crucial in strengthening the import demand function. These measures will not only support sustainable economic development but also optimize the import dynamics in Pakistan’s economy.</p>

2024-09-19T00:00:00+00:00 Copyright (c) 2024