Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/334147 
Year of Publication: 
2025
Citation: 
[Journal:] Asian Journal of Economics and Banking (AJEB) [ISSN:] 2633-7991 [Volume:] 9 [Issue:] 2 [Year:] 2025 [Pages:] 261-283
Publisher: 
Emerald, Leeds
Abstract: 
The purpose of this paper is to identify the changes in the stock market prices of banks in India with changes in FED rates in long run.Using both bivariate granger causality and ANOVA along with binomial logistic regression the influence of changes in FED rates on stock market prices of both major public sector and private sector banks have been derived.Private banks with higher shareholding of Foreign Institutions investors are influenced significantly as compared to public sector banks.The changes in FED rates and its influence over the stock prices are related directly to the shareholding pattern of Foreign Institutional Investors. The results suggest that changes in the FED rates have a direct impact on the financial sector stock prices, where a positive relationship is observed.For investors this provides a decisive signal for market-related investments in public sector vis-a- vis the private sector banks and for the policy makers this may open the door for policies related to foreign investments as well as policies related to managing liquidity positions.By using real datasets and granger causality analysis this paper will help in understanding the relationship between the banking stocks in India and changes in FED rates.
Subjects: 
Fed rates
Granger causality
FDI
Public sector banks
Private banks
Repo rate
Reverse repo
JEL: 
E42
E47
E52
G10
G18
G11
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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