The effect of Policy in the Sudanese pound exchange rate on consumer prices and inflation rates,

 an applied study in Sudan during the period ٢٠١٤-١٩٨٠

Abstract

The study dealt with the effect of Policies in the Sudanese pound exchange rate on consumer prices and inflation rates, an applied study in Sudan during the period ۱۹۸۰-۲۰۱٤. The study also aimed to analyze the silence and trend of the short and long-term relationship between the actual real exchange rate, consumer prices and inflation rates. The explanations for clarifying the effect of fluctuations in the actual real exchange rate, consumer prices and inflation rates. The problem of the study was represented in the continuous fluctuations of exchange rates affecting consumer prices and inflation rates. The study adopted a descriptive approach in view of the nature of the problem and the information available on it and discussed within the framework of the study. For the purpose of analyzing the time series, this requires testing the unit roots, the joint integration test, and the fluctuation test using the models (TARCH, EGARCH) The study reached the most important results of the existence of an integrative relationship between the study variables during the period (۱۹۸۰-۲۰۱٤). In addition, there was an impact of exchange rate fluctuations on changes in consumer prices and inflation rates, as well as the continuous decline in the Sudanese pound exchange rate by the International Monetary Fund, which led to the weakening of the Sudanese pound against foreign currencies, weakening the purchasing power, which increased the prices of imported goods, and this in turn was arranged. It has to increase the pressure on consumer prices. The study recommended that the central bank should not interfere in the exchange rate in order to balance the supply and demand of foreign currencies. Therefore, the most important recommendations for the study came to work to raise the value of the Sudanese pound against foreign currencies in the official market and eliminate the parallel market, which greatly damaged the national economy. This only comes to an increase in production and to create a climate for foreign investments in the country and to attract foreign currency remittances from residents abroad.