IMPACT OF INFLATION AND EXCHANGE RATES ON SOUTH ASIAN ECONOMIES: A COMPREHENSIVE STUDY (2000–2024)

Abstract

This study analyzes the impact of inflation and exchange rates on South Asian economies from 2000 to 2024, using panel data regression and Granger causality tests alongside qualitative policy reviews. Findings reveal that inflation and currency depreciation significantly hinder GDP growth and economic stability. Structural factors such as fiscal deficits, global commodity shocks, and monetary policies further influence inflation and exchange rate volatility. The study emphasizes the need for effective macroeconomic management, including inflation targeting and exchange rate stabilization, to promote sustainable growth. Policymakers are urged to adopt prudent monetary policies to control inflation and maintain currency stability, thereby improving trade competitiveness and attracting investment in the region.