How Oil Price Shocks Influence on Inflation Rate? Evidence from Malaysian Economy
DOI:
https://doi.org/10.61506/01.00350Keywords:
Oil price (OP), Inflation rate (IR), economic factors (EF), Government, MalaysiaAbstract
The primary object of this research is to inspect the effect of oil price (OP) on expansion and inflation rate (Inf) in Malaysia, this data collected on specific macroeconomic indicators such as inflation (Inf) and country’s oil price (OP) by utilizing year to year information from 2008 to 2018. This research study are based on secondary data. By using E- views regression model, correlation model, descriptive analysis, and graphical Causality model were used to break down the information about oil price (OP) and inflation rate (Inf). The relationship between two factors is presence more correlation effect at 5% large dimension over the long term. These show that the significant correlated with each other. In this study, data used as a form of secondary just oil cost price influenced the expansion of Malaysia economy. The conversion standard does not specify the main reason for both of the factors (Inflation rate (Inf) and Oil Price OP). Along these lines, the oil unrefined cost, which an effect on expansion economy. On the other hand that the rate of oil cost and expansion additionally make esteem changes, the advancement similarly changes. There is a progressively critical connection between oil price (OP) and inflation rate (Inf) in Malaysia economy. Research founded that there is a significant relationship between oil price and inflation rate. This finding helps the Malaysian government in essential leadership a way to deal with the oil price to manage inflation rates.
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