This paper has employed the use of multivariate modelling techniques in examining the dynamic beh... more This paper has employed the use of multivariate modelling techniques in examining the dynamic behaviour of systemic and non-systemic shocks on macroeconomic variables in Ghana with the main aim of having some level of understanding of how monetary policy decisions and actions affect inflation and output. A structural vector error correction model (s-vecm) was developed utilising information from estimated cointegrating relationships. Using a 7 variable system, the analysis was carried out by examining the dynamic nature of generalized impulse response functions generated from the model. The study found strong evidence of monetary policy instruments affecting inflation and output in the Ghanaian economy in the long run and that the exchange rate channel remains the main medium through which monetary policy
This paper has employed the use of multivariate modelling techniques in examining the dynamic beh... more This paper has employed the use of multivariate modelling techniques in examining the dynamic behaviour of systemic and non-systemic shocks on macroeconomic variables in Ghana with the main aim of having some level of understanding of how monetary policy decisions and actions affect inflation and output. A structural vector error correction model (s-vecm) was developed utilising information from estimated cointegrating relationships. Using a 7 variable system, the analysis was carried out by examining the dynamic nature of generalized impulse response functions generated from the model. The study found strong evidence of monetary policy instruments affecting inflation and output in the Ghanaian economy in the long run and that the exchange rate channel remains the main medium through which monetary policy
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