INFLATION AND MONTHLY STOCK RETURNS RELATIONSHIP IN THE AIRLINE MARKET

Abstract

The aim of this manuscript is to make an empirical analysis on the relationship between stock return and inflation in selected airlines from different regions of the world and airline alliances on a monthly selected dataset. The main results show regional, continental, or specific – country-based activities have got more impacts on inflation-stock return relations than airline alliances in the period between March 2014 and May 2022. Especially, inflation rates have got a causal, explanative and cointegrating relation with airline stock returns in Eastern countries or Asia.

Keywords

• Airlines
• Inflation
• Fourier Analysis
• Toda-Yamamoto causality test.

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