The Money Demand Relationship in Saudi Arabia: An Empirical Investigation: Reply
The main objective of my article, (Darrat, 1984), was to examine the sensitivity of domestic money demand in Saudi Arabia to changes in external monetary and financial factors such as foreign interest rates. Regression results over the quarterly period 1962/I‐1981/IV indicated that the Saudi money demand was significantly influenced by movements in foreign short‐term interest rates and currency exchange rates.