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The result showed no long-run relationship among the variables.Banny and Enlaw  analyzed the link between the Malaysian ringgit in relation to the US dollar and prices of stock in Kuala Lumpur Stock Exchange (KLSE).
According to Ibrahim and Agbaje , inflation rate has been increasingly unsteady despite some stringent policies and efforts made by governments to control and fine-tune its values to a satisfactory stationary single-digit number.
They also argued that factors such as income, high nominal wages, fluctuations in revenue, and the payment of debt can largely influence inflation in an economy.
These uncertainties can, however, cause an increase or decrease in price of stocks, which may affect the demand and supply of stocks in general.
The consequence of this instability in price level is that it may affect potential investor’s decision to invest and in turn have a negative impact on the total returns on stocks at large.
The creation of the Ghana Stock Exchange (GSE) was part of the recommendations of the economic reforms carried out in the 1980s to generate sustainable economic growth and development.
Boateng  observes that, after many years of experiment with heavy state intervention in the economy, a consensus emerged that the achievement of a more dynamic economic growth required a greater role for the private sector and stock markets, since they are good levers for boosting private sector access to finance.
According to Ibrahim and Agbaje , the stability of prices is vital in establishing whether the level of inflation will be constant or unstable in an economy.
They also argued that inflation is the constant increase in prices over a period of time.
The study examined the effect of exchange rate and inflation on stock market returns in Ghana using monthly inflation and exchange rate data obtained from the Bank of Ghana and monthly market returns computed from the GSE all-share index from January 2000 to December 2013.
The autoregressive distributed lag (ARDL) cointegration technique and the error correction parametization of the ARDL model were used for examining this effect.