How to Hedge against Inflation Risk in Vietnam
Vietnam has experienced galloping inflation and faced serious dollarization since its reform. To effectively control inflation for promoting price stability, it is necessary to find efficacious leading indicators and a hedging mechanism. Using monthly data over the period from January 1997 to June 2...
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| Format: | Article |
| Language: | English |
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MDPI AG
2023-03-01
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| Series: | Economies |
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| Online Access: | https://www.mdpi.com/2227-7099/11/3/94 |
| _version_ | 1797612250519830528 |
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| author | Nguyen Thi Thanh Binh |
| author_facet | Nguyen Thi Thanh Binh |
| author_sort | Nguyen Thi Thanh Binh |
| collection | DOAJ |
| description | Vietnam has experienced galloping inflation and faced serious dollarization since its reform. To effectively control inflation for promoting price stability, it is necessary to find efficacious leading indicators and a hedging mechanism. Using monthly data over the period from January 1997 to June 2020, this study finds the predictive power and hedge effectiveness of both gold and the US dollar on inflation in the long-run and short-run within the asymmetric framework. Especially, the response of inflation to the shocks of gold price and the US dollar is quick and decisive, disclosing the sensitivity of inflation to these two variables. |
| first_indexed | 2024-03-11T06:39:36Z |
| format | Article |
| id | doaj.art-26d60526b15f4b64abff1576a2c66805 |
| institution | Directory Open Access Journal |
| issn | 2227-7099 |
| language | English |
| last_indexed | 2024-03-11T06:39:36Z |
| publishDate | 2023-03-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Economies |
| spelling | doaj.art-26d60526b15f4b64abff1576a2c668052023-11-17T10:41:08ZengMDPI AGEconomies2227-70992023-03-011139410.3390/economies11030094How to Hedge against Inflation Risk in VietnamNguyen Thi Thanh Binh0Department of Accounting, Chaoyang University of Technology, Taichung City 41349, TaiwanVietnam has experienced galloping inflation and faced serious dollarization since its reform. To effectively control inflation for promoting price stability, it is necessary to find efficacious leading indicators and a hedging mechanism. Using monthly data over the period from January 1997 to June 2020, this study finds the predictive power and hedge effectiveness of both gold and the US dollar on inflation in the long-run and short-run within the asymmetric framework. Especially, the response of inflation to the shocks of gold price and the US dollar is quick and decisive, disclosing the sensitivity of inflation to these two variables.https://www.mdpi.com/2227-7099/11/3/94asymmetric cointegrationgold priceinflation hedgeMSI-VAR(1) modelthe US dollarVietnam |
| spellingShingle | Nguyen Thi Thanh Binh How to Hedge against Inflation Risk in Vietnam Economies asymmetric cointegration gold price inflation hedge MSI-VAR(1) model the US dollar Vietnam |
| title | How to Hedge against Inflation Risk in Vietnam |
| title_full | How to Hedge against Inflation Risk in Vietnam |
| title_fullStr | How to Hedge against Inflation Risk in Vietnam |
| title_full_unstemmed | How to Hedge against Inflation Risk in Vietnam |
| title_short | How to Hedge against Inflation Risk in Vietnam |
| title_sort | how to hedge against inflation risk in vietnam |
| topic | asymmetric cointegration gold price inflation hedge MSI-VAR(1) model the US dollar Vietnam |
| url | https://www.mdpi.com/2227-7099/11/3/94 |
| work_keys_str_mv | AT nguyenthithanhbinh howtohedgeagainstinflationriskinvietnam |