العلاقة السببية بين عرض النقود و التضخم في السودان (2012-1990)‎

Abstract EN

The aim of this research is to determine the nature of the causality relationship between the inflation and the money supply in Sudan during the period 1990-2012 using monthly data.

This relationship is obtained using granger causality techniques in five stages, which include: Unit-root, Co-Integration, Hsiao, Granger and Error Correlation Model in order to determine the direction of the relationship in short and long run.The analysis of the results show that the money supply series is stationary in its value and the inflation series become stationary after taken the first different; also there is co-integration relationship between inflation and money supply in long run.

The Granger causality test reveals bi-directional relationship between money supply and inflation rate in the short run, and the direction of the relationship is unidirectional move from money supply to inflation in long run.The research recommends finding tools to absorb the increase of money supply in the economy and to create new channels to finance the government deficit than borrowing from the Central bank in order to achieve a stable and reduced inflation rates.