Analysis of the Influence of CPEC on Monetary Policy Decision in Pakistan

Authors

  • Majid Ali Sanghro Department of Economics University of Sindh Jamshoro, Sindh, Pakistan
  • Farhanzeb Khaskhelly f Business Administration at University of Sufism and Modern Sciences, Bhitshah, Pakistan
  • Ambreen Zeb Khashkelly Department of Economics University of Sindh, Jamshoro, Sindh, Pakistan

DOI:

https://doi.org/10.51872/prjah.vol1.Iss01.13

Keywords:

CPEC, Economic, Cooperation, Monetary Policy, Financial System

Abstract

The purpose of this research is to extent to which the China- Pakistan Economic Corridor (CPEC) can impact monetary policy decisions in Pakistan. This is in response to further research in previous studies. A robust econometric model was applied to economic data procured from the financial and statistical institutions in Pakistan and China. The analysis suggests the potential of the economic cooperation to inure to the benefit of both Pakistan and China in terms of economic development. Return on the analysis indicated that financial sector in Pakistan in particular is more susceptible to risk based on the influx of Chinese funds into the system. Specifically it is concluded the inflation and foreign exchange volatility are the most vulnerable areas of concern. Based on this knowledge it is proposed that the financial regulatory authorities in Pakistan must develop appropriate response strategies to safeguard the stability of the entire financial system on a constant basis.

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Published

2020-12-28

How to Cite

Sanghro, M. A. ., Khaskhelly, F., & Khashkelly, A. Z. (2020). Analysis of the Influence of CPEC on Monetary Policy Decision in Pakistan. Progressive Research Journal of Arts & Humanities (PRJAH), 1(1), 28–40. https://doi.org/10.51872/prjah.vol1.Iss01.13