The important determinants of Inflation in Sudan and the effectiveness of monetary and fiscal policy in inflation reduction

During the period 2000-2014 with focusing on the period 2008-2014

Abstract

 
Inflation is regarded as main problem that faced the countries in a whole world, and Sudan has been suffering of this problem especially in specific period of time such as beginning of 1990s and also since 2008 until 2014, so this study focuses on this period of a time.
The paper aims to study the inflation in Sudan during the period 2000-2014 with focusing on the period during 2008-2014 because of this period has suffered of sharp increasing in inflation and also deterioration in the economy, and determine the performance of the macro-economic variables therefore the impact of that in inflation.
The study used the descriptive analysis additional to the quantitative analysis through the simultaneous equations model that includes two equations.
The paper puts some hypotheses which are the external debt is an important factor that increases the inflation rates rapidly during the period 2000-2014, the financial deficit of public budget has a role in increasing the inflation rates rapidly during the study period, the decreasing of real GDP leads to increase the inflation rate during the study period, and the monetary and fiscal policies are ineffective to reduce the inflation during the period 2008-2014.
The study accepted the four hypotheses that reached to results can be briefed in determining the important determinants of inflation during the period 2000-2014 in the external debt, the financial deficit of public and the real GDP and the last result is an ineffective monetary and fiscal policy to achieve the inflation reduction during the period 2008-2014. And the descriptive analysis of the study reached to other results that there is some reform in monetary and fiscal policy in 2013 and 2014, but it is not sufficient to reduce the inflation, because the reformatory needs to structural and strong procedures with consistency between the both monetary and fiscal policy.