The Moderating Role of Earnings Management on the Relationship Between Bank Earnings and Economic Inflation in Jordan.

This study explores the moderating role of earnings management in the relationship between banks' earnings and economic inflation. Using a quantitative approach, we analyze data from a sample of Jordanian banks for the period 2009–2018. We negotiated the descriptive statistics of sample study observations, and the correlation between variables was tested, and employing regression analysis to investigate the interactions among these variables. Our findings indicate that earnings management significantly impacts the sensitivity of bank earnings to economic inflation, suggesting that banks engage in earnings manipulation to maintain performance metrics during inflationary periods, or manipulation practices negatively affect the economy through users’ decisions. The results have implications for regulators and stakeholders in understanding the financial behavior of banks in volatile economic conditions.