GOLD PRICE AND EXCHANGE RATE - AN ANALYSIS OF LONG RUN RELATIONSHIP

The study investigates the long run relationship between gold price and exchange rate. The main objective of the study is to identify whether there is long run relationship between gold price and exchange rate. The study has evaluated daily data of gold price and exchange rate over a period from July 2011 to June 2014. By applying Augmented Dickey Fuller Unit Root Test, Johansen Co - integration Test and Granger Causality Test the study concluded that there is no causality and no long run relationship betwe en gold price and exchange rate.