International Journal of Research in Economics and Social Sciences (IJRESS) Available online at: http://euroasiapub.org Vol. 7 Issue 8, August- 2017, pp. 321~330 ISSN(o): 2249-7382 | Impact Factor: 6.939 International Journal of Research in Economics & Social Sciences Email:- editorijrim@gmail.com, http://www.euroasiapub.org (An open access scholarly, peer-reviewed, interdisciplinary, monthly, and fully refereed journal.) 321 Is there Relationship between MIFOR and US-Interest Rate Swap Markets! Veeraraghavan R 1 Ph.D. Research Scholar, Department of Commerce Pondicherry University Velmurugan PS 2 Assistant Professor, Department of Commerce Pondicherry University Rinku Champramary 3 Ph.D. Research Scholar, Department of Commerce Pondicherry University ABSTRACT An investigation into causal relationship between MIFOR and US Indian interest rate swap in post liberalization period have a royal importance in predicting or understanding the price movements in a financially globalized world. Here this paper empirically examined the basic objective of this study availing well established econometrics models. Johansen’s co-Integration test, and Granger’s Causality test is employed to measure long run and short run relationships respectively for the period of October 2002 to June 2016. This paper brought forward evidence for long run relationship in one and fifth year contracts and a trend of decreasing, Dzcause effect relationshipdz with increase in duration of contracts. Key Words: Interest Rate Swaps, Johanson's Co integration Test, Granger Causality, MIFOR, US-IRS. 1. Introduction: Global markets tend to be progressively incorporated. Such advances have been quickened by the innovation and globalisation in financial markets which are fully liberalized. Which gives us feeling that a jolt in one financial markets will be immediately reflected to other financial markets. An event in one market may or sometimes may not reflect in another market. If reflected the effect might be either for a shot period or for a long period over the time in different financial markets. The blend of such effects either long term or short term on oneǯs financial market to another has often been discussed and tested using different methodologies by several researchers in different fields like in commodity markets; Ardeni, (1989) on various commodity prices among the countries like Australia, Canada, UK and USA; Karbuz & Jumah, (1995) on relationship between spot and futures between