Can gold hedge against inflation? an empirical analysis in Malaysia

• Main Author: Izaan Azyan Abdul Jamil
• Format: Thesis
• Language: English; English
• Published: 2014
• Subjects: HG201-1496 Money
• Online Access: https://eprints.ums.edu.my/id/eprint/37454/1/24%20PAGES.pdf; https://eprints.ums.edu.my/id/eprint/37454/2/FULLTEXT.pdf; https://eprints.ums.edu.my/id/eprint/37454/
• Institution: Universiti Malaysia Sabah

The purpose of this study is to examine the role of gold price to hedge against inflation in Malaysia. Previous studies stated that gold price can maintain its purchasing power and able to hedge against inflation. Malaysian database from 1967 to 2011 was used where gold price, consumer price index, real interest rate, real income, and real exchange rate as variables in this research. The main finding in this study indicates that gold price has a relationship with domestic inflation in the short and long run. Other than that, gold price quoted in Ringgit also able to hedge against inflation in the long run. Thus, the main finding in this study could benefit both Malaysian Monetary and Investment Authority in hedging Inflation.