International Journal of Science and Research (IJSR)

International Journal of Science and Research (IJSR)
Call for Papers | Fully Refereed | Open Access | Double Blind Peer Reviewed

ISSN: 2319-7064


Downloads: 109 | Views: 205

Research Paper | Economics | China | Volume 5 Issue 10, October 2016


Analysis of Interest Rate and Stock Price in Africa: Case Study of Ghanaian Listed Firms

Bridget Opoku-Agyemang | Grace Ofori-Abebrese | Benjamin Korankye [2]


Abstract: In this study, we investigate the impact of interest rate on stock prices in Ghana by employing OLS model with monthly data spanning from January, 2000 to September, 2010. To prove our concept, we used Granger causality to test the direction and the causality between interest rate and stock prices in the context of Ghana. The test results show that there is unidirectional causality between interest rate and stock price. This means that changes in the stock price explains the variations in the interest rate. The empirical results indicated that interest rate definitely has negative effect on stock price in Ghana. The outcome also indicated unidirectional causality between interest rate and stock price.


Keywords: inflation, interest rate, stock price, Ghana stock market


Edition: Volume 5 Issue 10, October 2016,


Pages: 1582 - 1587


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