Publication: Do financial markets respond to populist rhetoric?
Program
School / College / Institute
College of Administrative Sciences and Economics
KU-Authors
KU Authors
Co-Authors
Çakmakli, Cem
Güneş, Gökhan Şahin
Publication Date
Language
Type
Embargo Status
Journal Title
Journal ISSN
Volume Title
Alternative Title
Abstract
With the global rise in populism over the last decade, there has been an increase in political commentaries (PC) by leaders that criticize their central banks and argue for lower interest rates. We analyse the effects of PCs on exchange rates, bond yields, and the risk premium for six countries that are subject to political pressures. Utilizing a specification with time-varying parameters, we show that PCs affect the level and the volatility of exchange rates, bond yields and the risk premium in Turkey. The response increases over time. In other countries, there is a significant impact on exchange rate volatility.
Source
Publisher
John Wiley and Sons Inc
Subject
Economics, Social sciences, mathematical methods, Statistics and probability
Citation
Has Part
Source
Oxford Bulletin of Economics and Statistics
Book Series Title
Edition
DOI
10.1111/obes.12591