The effect of foreign Exchange rates on the performance of the Nairobi Securities Exchange
Abstract
The changes in foreign exchange rates have diverse effect across the
economic spectrum in any country. The sectoral and economy wide effects
of foreign exchange rates may ultimately be reflected in the stock prices.
The objective of this study was to examine the effect of foreign exchange
rates on performance of NSE over the period January 2011 to December
2013.The study used a multiple regression model of NSE 20share index
dependent on three variables; foreign exchange rate, inflation and interest
rate. The main source of data was NSE and the Central Bank of Kenya
statistics.
The regression results show that foreign exchange rates, inflation and
interest rates explain 72.9% changes in stock prices. Foreign exchange rate
has insignificant relationship. So it does not have a significant effect on the
performance of the NSE.
Publisher
University of Nairobi
Description
Thesis