The influence of palm oil price movement under bursa derivative Malaysia / Nur Huzaifah Abd Aziz

• Main Author: Abd Aziz, Nur Huzaifah
• Format: Thesis
• Language: English
• Published: 2021
• Subjects: Interest rates; Money and prices. Inflation. Deflation. Purchasing power; Palm oil
• Online Access: https://ir.uitm.edu.my/id/eprint/106369/1/106369.pdf; https://ir.uitm.edu.my/id/eprint/106369/

Malaysia is the second-largest global palm oil exporter after Indonesia and it is mainly exponing to other countries such as India, Singapore, China and the United State. However, this ranking is able to change due to a few factors such as Interest Rate, Global economic performance (Inflation Rate) and the Exchange Rate. In this study, time series data from 2012 to 2020 were obtained monthly and the total of observations is 108. The objective of this research is to find out whether Macroeconomics' variable have correlation with the Palm Oil Price Movements under Bursa Derivative Malaysia. Regarding this study, there are many factors or influences that affect the Palm Oil Price Movement. There are three factors to be highlighted in this research which is Interest Rate, Inflation Rate and Exchange Rate. Furthermore, a multiple regression model was used to analyse the relationship between each factor to the dependent variable which is the Crude Palm Oil (CPC)) Price. The findings revealed that all independent variables have the predicted sign and the exchange rate has a clear positive relationship, making it one of the most significant factors influencing Malaysian palm oil supply and demand. A solid understanding of this discussion will be extremely useful to the investors who invest in a Crude Palm Oil Futures under the Bursa Derivative Market. In a nutshell, this research suggests that policymakers should regulate the national currency to prevent fluctuations in Malaysian palm oil price movement.