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Volume :23 Issue : 1 1995
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Money Supply in Qatar: An Analytical study of its Determinants
Auther : Saif S. Alsowaidi
Central banks pay important attention to money supply due to its possible wide effects on the economy analyzing data from Qatar, it is found that M2 is less stable than M1. It is argued that the variability of M2 includes a foreign-currency component which is affected by determinants that do not come either under the direct command of Qatar Monetary Agency or under the indirect command due to the limited use of monetary tools in the country. This has affected the stability of money supply multiplier which may suggest a room for developing monetary tools and financial market, a step that will enhance the role of Qatar Monetary Agency as the central bank of Qatar. Using a dynamic “cointegration” approach: the paper shows that GDP is related to money supply, a conclusion which highlights the possible reflections of money supply in Qatar.