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A study of the interrelation between inflation and BSE consistency

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Original Article

Author Details : K Prabhakar Rajkumar*

Volume : 5, Issue : 3, Year : 2018

Article Page : 268-274

https://doi.org/10.18231/2394-2770.2018.0042

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Abstract

This study examines the relationship between WPI measured inflation and BSE market consistency proxied by market capitalization, BSE Sensex 30 and trading turnover-both value and volume, during the period April, 2000 to March, 2014. The investigation has been made by applying the vector error correction model and Johansen co-integration test. The study analysed the correlation between the variables by using Karl Pearson Coefficient of correlation matrix, further confirmed through the test of significance. All the findings of the study were justified through the correlated variables. In addition the Johansen co-integration test results show that there is a long run, but there is a negative relationship between WPI measured inflation and selected proxies of BSE consistency during the evaluated period. However, no short run interrelation between the variables also observed during the study period.

Keywords: Capital markets, Financial intermediation, Correlation, Co-integration, Vector error correction, Inflation, Market capitalization, BSE sensex 30.

How to cite : Rajkumar K P, A study of the interrelation between inflation and BSE consistency. J Manag Res Anal 2018;5(3):268-274

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