DETERMINING AFFECTING MACROECONOMIC INDICATORS ON INTEREST RATES IN EMERGING COUNTRIES: A COMPARATIVE EXAMINATION UPON CHINA, BRAZIL, AND TURKEY WITH MULTIVARIATE ADAPTIVE REGRESSION SPLINES (MARS)

Year 2020, Volume: 2 Issue: 1, 23 - 41, 30.03.2020

Mustafa Tevfik Kartal

Abstract

China, Brazil, and Turkey are
important emerging countries and have different interest rate trends. China and
Brazil enjoyed the lower interest rate of approximately 1.5% and 6.8%
respectively whereas Turkey was faced with increasing interest rate problems
reaching 23.35% as of 2018 end. The study aims to analyze and define
macroeconomic determinants of interest rates. 11 independent variables, yearly
data between 2002 and 2018 were examined with the MARS method. The study
determines that growth and reserves have effects in China; credits and net
export have effects in Brazil whereas inflation and money supply are
influential in Turkey on interest rates.

Keywords

Interest Rate, Macroeconomic Determinants, MARS, China, Brazil, Turkey

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