Monetary Policy, External Shocks and Economic Growth Dynamics in East Africa: An S-VAR Model

Resulting from the incessant political and economic uncertainty that bedevils EAC region in recent past, various governments have used monetary policy changes response to shocks macroeconomic variables. However, available literature shows a non-agreement by scholars as far dynamics policy, external activity connections are concerned, for both country-by-country analyses regional assessments. This article widens frontiers of knowledge about how performance interact within region. We adopted S-VAR method because its contemporary nature transmission approach is concerned. The interconnectivity among countries an indication any shock price commodities (non-oil commodities) has significant implication on exchange rate, which will be channelled through supply money GDP. need diversify productive export base member countries, compared continuous dependence one or few products major source income, hereby advocated.