The Chinese Yuan effect: An interaction of exchange rates and stock indices with import-export trade as indirect factors of China and the ASEAN-5 countries (2006-2014)
Date of Publication
2016
Document Type
Bachelor's Thesis
Degree Name
Bachelor of Science in Management of Financial Institutions
College
Ramon V. Del Rosario College of Business
Department/Unit
Financial Management
Thesis Adviser
Mar Andriel S. Umali
Defense Panel Chair
Patrick Salvacion Benito
Defense Panel Member
Ruben Carlo Asuncion
Regina Aseron
Abstract/Summary
China, being known as the largest Asian economy, has played a significant role in the global economy which also influenced the growth and expansion of its trading relationship with its neighboring countries, specifically the ASEAN community. Its initial members namely Indonesia, Malaysia, Philippines, Singapore, and Thailand or commonly known as the ASEAN-5, has attracted numerous investors and multinational firms into their countries.
The purpose of this study is to determine the causal relationship between the Chinese Yuan exchange rates and ASEAN-5 stock indices. It also analyzes as to what extent does trading (i.e. exports, imports, and total trade), as an indirect factor, affect the relationship of the said variables. The variables of the study are the respective foreign exchange rates, stock indices, and trading activities of China and the ASEAN-5's. The period covered for the variables are from January 2006 to December 31, 2014. In order to test for the causal relationship between the variables, the Granger causality and Johansen cointegration test were utilized in this study.
Results show that only the Chinese Yuan/Thailand Baht exchange rate had a bidirectional relationship with the China's stock index. While the rest of the ASEAN-5 countries except Malaysia had a unidirectional relationship with the Chinese Yuan exchange rate. With these results, the group concludes that there is no general consensus arrived at on the relationship between the two variables. Moreover, this may imply that the Chinese Yuan will not drastically impact the trading activities toward the ASEAN-5 countries. With the recent implementation of the ASEAN Integration, the ASEAN community can be seen as a threat to China and can possibly overthrow them. However, the strong presence and influence of China in the global economy still persist.
Abstract Format
html
Language
English
Format
Accession Number
TU21363
Shelf Location
Archives, The Learning Commons, 12F, Henry Sy Sr. Hall
Physical Description
iii, 250 leaves ; 28 cm. + ; 1 computer optical disc.
Keywords
Foreign exchange rates--China; Stocks--Prices--China; Stock price indexes--China; Foreign exchange rates--Southeast Asia; Stocks--Prices--Southeast Asia; Stock price indexes--Southeast Asia
Recommended Citation
Ligeralde, J. O., Lim, K. C., Santiago, I. A., & See Diet, M. L. (2016). The Chinese Yuan effect: An interaction of exchange rates and stock indices with import-export trade as indirect factors of China and the ASEAN-5 countries (2006-2014). Retrieved from https://animorepository.dlsu.edu.ph/etd_bachelors/7754