The Effects of Exchange Rate Fluctuationson Output and Prices
The Effects of Exchange Rate Fluctuationson Output and Prices

Author: Ida Aghdas Mirzaie

Publisher: International Monetary Fund

Published: 2003-10-01

Total Pages: 32

ISBN-13: 1451860188

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The paper examines the effects of exchange rate fluctuations on real output and the price level in a sample of 33 developing countries. The theoretical model decomposes movements in the exchange rate into anticipated and unanticipated components. Unanticipated currency fluctuations help to determine aggregate demand through exports, imports, and the demand for domestic currency, and aggregate supply through the cost of imported intermediate goods. Anticipated exchange rate depreciation, through the supply channel, has limited effects on output growth and inflation. Unanticipated currency fluctuations appear more significant, with varying effects on output growth and price inflation across developing countries.

The Effects of Exchange Rate Fluctuations on Output and Prices
The Effects of Exchange Rate Fluctuations on Output and Prices

Author: Magda Kandil

Publisher:

Published: 2006

Total Pages: 32

ISBN-13:

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The paper examines the effects of exchange rate fluctuations on real output and the price level in a sample of 33 developing countries. The theoretical model decomposes movements in the exchange rate into anticipated and unanticipated components. Unanticipated currency fluctuations help to determine aggregate demand through exports, imports, and the demand for domestic currency, and aggregate supply through the cost of imported intermediate goods. Anticipated exchange rate depreciation, through the supply channel, has limited effects on output growth and inflation. Unanticipated currency fluctuations appear more significant, with varying effects on output growth and price inflation across developing countries.

The Asymmetric Effects of Exchange Rate Fluctuations
The Asymmetric Effects of Exchange Rate Fluctuations

Author: Ms.Magda E. Kandil

Publisher: INTERNATIONAL MONETARY FUND

Published: 2000-11-01

Total Pages: 33

ISBN-13: 9781451859355

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The paper examines the asymmetric effects of exchange rate fluctuations on real output and price in developing countries. The theoretical model decomposes movements in the exchange rate into anticipated and unanticipated components. Unanticipated currency fluctuations determine aggregate demand through exports, imports, and the demand for domestic currency, and determine aggregate supply through the cost of imported intermediate goods. The evidence indicates that the supply channel leads to output contraction and price inflation in the face of unanticipated currency depreciation. In contrast, the reduction in net exports determines output contraction without reducing price inflation in the face of unanticipated currency appreciation.

The Effects of Exchange Rate Fluctuations on Economic Activity in Turkey
The Effects of Exchange Rate Fluctuations on Economic Activity in Turkey

Author: Magda Kandil

Publisher:

Published: 2018

Total Pages:

ISBN-13:

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The paper examines the effects of exchange rate fluctuations on real output, the price level, and the real value of components of aggregate demand in Turkey. The theoretical model decomposes movements in the exchange rate into anticipated and unanticipated components. Unanticipated currency fluctuations help to determine aggregate demand through exports, imports, and the demand for domestic currency, and aggregate supply through the cost of imported intermediate goods and producers' forecasts of relative competitiveness. Anticipated exchange rate appreciation has significant adverse effects, contracting the growth of real output and the demand for investment and exports, while raising price inflation. Unanticipated exchange rate fluctuations have asymmetric effects that highlight the importance of unanticipated depreciation in shrinking output growth and the growth of private consumption and investment, despite an increase in export growth.

Exchange Rate Fluctuations and Output in Oil-Producing Countries
Exchange Rate Fluctuations and Output in Oil-Producing Countries

Author: Mohsen Bahmani-Oskooee

Publisher: International Monetary Fund

Published: 2007-05

Total Pages: 38

ISBN-13:

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Conventional wisdom states that currency depreciation in oil-producing countries are contractionary because demand effects, limited by the prevalence of oil exports priced in dollars, are more than offset by adverse supply effects. Iran, however, has experienced a rapid increase in non-oil exports in the last decade. Against this background, the paper tests whether the conventional wisdom still applies to Iran and concludes that the emergence of the non-oil export sector has made currency depreciation expansionary. The expansionary effect is particularly evident with respect to anticipated persistent depreciation in the long-run. Notwithstanding the varying effects of exchange rate fluctuations on the demand and supply sides of the economy, managing a flexible exchange rate gradually over time towards achieving stability in the real effective exchange rate may strike the necessary balance.

Exchange Rates
Exchange Rates

Author: Natalie B. Perkins

Publisher:

Published: 2011

Total Pages: 0

ISBN-13: 9781612095059

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In finance, the exchange rates between two currencies specifies how much one currency is worth in terms of the other. This new book presents topical research on the policies, effects and fluctuations of exchange rates. Topics discussed include the effects of exchange rate fluctuations on real output, the price level, and the real value of components of aggregate demand in Egypt and Turkey; the role of CEECs exchange rates in monetary policy rules; the competitiveness of exchange rate fluctuations in Middle Eastern countries; foreign exchange rate exposure of Chinese firms in the new exchange rate regime and exchange rate flexibility and real adjustments in emerging market economies.

Exchange Rate Fluctuations and Disaggregated Economic Activity in the Us
Exchange Rate Fluctuations and Disaggregated Economic Activity in the Us

Author: Magda Kandil

Publisher:

Published: 2003

Total Pages: 0

ISBN-13:

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We examine the extent to which exchange rate fluctuations affect the US sectoral output and price. The evidence indicates that the expansionary and contractionary effects cancel out in determining industrial real output growth in the face of exchange rate fluctuations. More importantly, there is evidence of a reduction in price inflation in several industries, which is statistically significant in Finance, in response to dollar appreciation. This evidence is consistent with the reduction in aggregate demand through the decline in net exports and the increase in aggregate supply through the reduction in the cost of imported intermediate goods.

Exchange Rate Volatility, Pricing to Market and Trade Smoothing
Exchange Rate Volatility, Pricing to Market and Trade Smoothing

Author: Mr.Peter B. Clark

Publisher: International Monetary Fund

Published: 1997-10-01

Total Pages: 40

ISBN-13: 1451936621

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This paper investigates the consequences of exchange rate volatility on the variability of export prices and quantities in the presence of market segmentation and pricing to market. Firms stabilize destination prices through systematic price discrimination, limiting the degree of exchange rate pass-through. Consequently, the variability of exchange rates is not fully translated into prices and quantities at the point of destination. Empirical estimates using aggregate price data for the G-7 industrial countries show incomplete pass-through in variances, with considerable variation among these countries. U.S. industry specific data also indicate incomplete pass-through in most cases, with considerable variation across industries.