Analysis reveals worsening market conditions amidst rising economic policy uncertainty, suggesting vital insights for investors.
The impact of economic policy uncertainty on financial markets is becoming more and more significant. Through big data technology, time series analysis, and machine learning algorithm, the author of this paper discusses the impact of economic policy uncertainty on financial markets, especially under the background that globalization and informatization aggravate the complexity of the global economic environment. The author found that with the increase of economic policy uncertainty, the stock market yield decreases, the credit spread in the bond market expands, and the exchange rate fluctuation in the foreign exchange market intensifies. Based on data from 2010 to 2023, these hypotheses are verified by regression model analysis, and the significant relationship between economic policy uncertainty and financial markets is revealed. The research results provide not only a basis for policymakers to adjust the direction and intensity of policies but also support for investors to better understand market trends and improve the scientific nature of investment decisions.
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Xinyi Zhang (2025) studied this question.
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