The impact of Monetary policy on financial and real price instability through GMM Method

To fully accomplish monetary policy، the awareness of central bank about transmission process and the impact of it on the other economic variables is critical. One of the most important mechanisms is the impact of monetary policy on asset prices. This paper surveys the impact of monetay policy on some asset prices such as Gold، Exchange rate، Real estate and Stock market in Iran. Estimating the response of asset price variation on monetary policy would be felt with some difficulties، problems such as implementation of both monetary policy and asset price change، also some missing variables which have affected the monetary policy and asset price، together. These two issues make identification and diognosing of this reaction harder. So، this research uses the diagnosing techniques through heterogenons variance of monetary policy shocks which have been introduced by Rigbon and Sock (2004). Our monthly estimates during 1999-2012 indicate that expansionary monetary policy has positive impact on Real state، Stock market and Gold price while it has negative impact on Exchange rate.