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International Journal of Academic Research in Business and Social Sciences

Open Access Journal

ISSN: 2222-6990

The Role of Macroeconomic Variables in the Islamic Real Estate Investment Trusts (I-REIT) Market in Malaysia

Mohd Yahya Mohd Hussin, Fidlizan Muhammad, Azila Abdul Razak, Fatimah Salwa Abdul Hadi, Pei-Tha Gan

http://dx.doi.org/10.6007/IJARBSS/v7-i4/2901

Open access

This research aims to analyse the presence of short and long term relationships between Islamic real estate investment (I-REIT) return and macroeconomic variables in Malaysia. To conduct this study, the research model adopted an estimation of Vector Auto Regression (VAR) method. The analysis employs monthly data from January 2007 to December 2013. The result shows that there is a significant positive relationship between the Islamic real estate investment trust and Industrial Production Index variable, but significant negative relationship with Islamic Inter Bank Rate and Exchange Rate of Malaysian Ringgit - United State Dollar variables. On the other hand, the I-REIT shows an insignificant negative relationship with the Consumer Production Index, FTSE Bursa Malaysia Emas Shariah Index, and M3 variables. The Granger causality analysis shows that there is a causal relationship between the variables of Consumer Production Index, Industrial Production Index, M3, and I-REIT.

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