Does central bank independence affect stock market volatility?

This paper addresses the issue of impacts of central banks’ independence on stock market volatility. Using a simple theoretical macroeconomic model, we analytically find a positive link between stock prices volatility and central bank independence. By applying panel data analysis on a set of 29 countries from 1998 to 2005, sufficient evidence for this positive relationship is provided using two different measures of stock market volatility. © 2017 Elsevier B.V

Interest rate dynamic effect on stock returns and central bank transparency: Evidence from emerging markets

Interest rate dynamic effect on stock returns is examined under different levels of central bank transparency under an asset pricing context. Using a large set of emerging countries in a panel data framework, we provide evidence for a negative link between stock returns and interest rate differences. However, this negative effect is reduced significantly under a transparent central bank, underlying a non-linear impact on stock returns. Our study is focused on a period from 1998 to 2008 where fundamental changes in the level of central banks’ transparency were occurred. Our findings imply that restrictive monetary policies under high levels of transparency lead to smoother reductions on stock returns with significant benefits for financial stability. © 2016 Elsevier B.V

Does central bank transparency affect stock market volatility?

This paper addresses the issue of impacts of central banks' transparency on stock market volatility. Using a simple theoretical macroeconomic model, we analytically find a negative link between stock prices volatility and central bank transparency. By applying panel data analysis on a set of 40 countries from 1998 to 2005, sufficient evidence for this negative relationship is provided, using three different measures of stock market volatility. Therefore, moving towards monetary policy transparency is recommended as stock market volatility can be reduced considerably, implying significant benefits for financial stability. (C) 2014 Elsevier B.V. All rights reserved

Central bank transparency and the interest rate channel: Evidence from emerging economies

This paper highlights the essential role of central bank transparency in the transmission mechanism Of monetary policy through the interest rate channel for emerging economies. It has been Shown that when the central bank's monetary policy is more transparent, the transmission mechanism of that monetary policy is more effective. Highly transparent central banks do not need to be aggressive in their policy rate actions in order to more effectively produce output and price dynamics implied by monetary policy shocks. (C) 2014 Elsevier B.V. All rights reserved