The effect of oil shocks on inflation and gold prices

In this article, we examine the impact of oil shocks on inflation and the price of gold. For this purpose, we use the vector regression model (VAR), which is one of the common methods in time series econometrics, to estimate the hypotheses.Oil price shocks have different effects on the economies of oil exporting and importing countries. Iran is one of the oil exporting countries, where oil revenues are the main source of financing the Iranian government budget and oil price fluctuations have a great impact on the Iranian economy. Therefore, in the above article, the Iranian economy in the period March, ۲۰۱۱ to October, ۲۰۲۱ is considered. The results show that; Oil shocks affect inflation and the price of gold. In this study, in order to evaluate the effect of shocks, we shocked the variables by a standard deviation so that we could examine their effect. According to research results, the effect of inflation shock on inflation disappears after ۷ periods. Also, the effect of inflation shock on the price of gold can be interpreted from period ۵ to ۱۷, which indicates a shock. The shock effect of the gold price on the gold price is neutral. Also, the effect of oil price shock on oil prices disappears after ۱۸ periods.

Keywords:

Oil Shocks , Inflation , Vector Regression Model (VAR)