Empirical test on impacts of monetary policy and fiscal policy on Vietnam’s stock marke

Abstract

This research evaluates the effects of monetary policy tools and fiscal policies on Vietnam’s stock market, in addition to examining interaction between these two policies with the Vietnam stock price index. Utilizing Vector Error Correction Model (VECM), with nine variables and data monthly statistics from January 2002 to October 2015, this study confirms that there are links between monetary policy/fiscal policy and Vietnam's stock market. In addition, Vietnam’s stock market is also affected by exogenous factors, namely the world oil prices and the S&P500 index, especially when Vietnam's economy is opening up and integrated with the global economy.