ESTIMATION OF THE IMPACT OF INTEREST RATES ON THE PERFORMANCE OF THE STOCK MARKET IN SAUDI ARABIA
DOI:
https://doi.org/10.61841/9vy9wj93Keywords:
Interest, stock market performance, oil prices, inflation, monetary policy, Saudi Arabia, Tadavul All Share Index, Economic Diversification, Vision 2030, Financial Stability.Abstract
The study checks the effect of rapid rashes in the interest rate on the performance of the Saudi stock market, uses oil prices and inflation as control variables. Given the Saudi Arabia addiction on oil revenues and its permanent exchange rate regime, an understanding of interaction between monetary policy and stock market dynamics is important for decision makers and investors. From January 2019 to December 2024, using a semi-Loo-layergarritic regional model and monthly data, the study found that rising interest rates adversely affect Tadavul All Share Index (TASI), while oil prices and inflation have a positive effect. The results highlight the unique economic structure of an oil-dependent economy, providing insight into economic policy efficiency under Vision 2030. Conclusions are important for stability in the financial market, decision-making and financial diversification strategies in Saudi Arabia.
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Saudi Exchange (Tadawul): https://www.saudiexchange.sa
Saudi Central Bank (SAMA): https://www.sama.gov.sa
OPEC: https://www.opec.org
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