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2 edition of determinants of aggregate variables in different exchange rate systems found in the catalog.

determinants of aggregate variables in different exchange rate systems

Volbert Alexander

determinants of aggregate variables in different exchange rate systems

by Volbert Alexander

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  • 7 Currently reading

Published by Fakultät für Wirtschaftswissenschaften und Statistik, Universität Konstanz in Konstanz .
Written in English

    Places:
  • Germany (West)
    • Subjects:
    • Foreign exchange -- Mathematical models.,
    • Monetary policy -- Mathematical models.,
    • Foreign exchange -- Germany (West) -- Econometric models.,
    • Monetary policy -- Germany (West) -- Econometric models.

    • Edition Notes

      StatementV. Alexander and H.-E. Loef.
      SeriesDiskussionsbeiträge., Nr. 132
      ContributionsLoef, Hans-Edi.
      Classifications
      LC ClassificationsHG3823 .A44 1979
      The Physical Object
      Paginationiii, 71, 3 p. :
      Number of Pages71
      ID Numbers
      Open LibraryOL2791575M
      LC Control Number83219385

      exchange rate and disposable income. Consumption expenditure as a function of disposable income Determinants of Aggregate Demand (cont.) • Determinants of aggregate demand include: Real exchange rate: an increase in the real exchange rate increases the current account, and therefore increases aggregate demand of domestic Size: KB. Free-Floating Systems. In a free-floating exchange rate system, governments and central banks do not participate in the market for foreign relationship between governments and central banks on the one hand and currency markets on the other is much the same as the typical relationship between these institutions and stock markets.

      The determinants of exchange rate in Croatia Manuel BENAZIC*, Ines KERSAN-SKABIC** Abstract The dilemma for every country with an independent monetary policy is which kind of exchange rate arrangement should be applied. Through the exchange rate policy, countries can influence their economies, i.e. price stability and export Size: KB. Seminar paper from the year in the subject Business economics - Banking, Stock Exchanges, Insurance, Accounting, grade: 1,3, California State University, Fullerton, course: International Economics, 8 entries in the bibliography, language: English, abstract: This paper will discuss the general relationship between the two major currencies of the world: the US-Dollar and the Euro and the.

      As Figure "South Africa-United States exchange rate, June " shows, exchange rates can be very volatile. In a single month (June ), the South African rand depreciated from about to rand to 1 USD, with various ups and downs along the way. Highlights We developed a real exchange rate model for a small-open economy. The model was tested on Canadian data for the period – It was found that the model performs very well in both long and short runs. None of the domestic fiscal variables has any statistically significant impact on the growth of the real exchange rate over the by:


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Determinants of aggregate variables in different exchange rate systems by Volbert Alexander Download PDF EPUB FB2

Alexander, Volbert & Loef, Hans-Edi, "The determinants of aggregate variables in different exchange rate systems," Discussion Papers, Series IUniversity of Konstanz, Department of Economics. Handle: RePEc:zbw:kondp What Determines the Exchange Rate: Economic Factors or Market Sentiment.

Gregory P. Hopper* R eaders of the financial press are familiar with the gyrations of the currency market. No matter which way currencies zig or zag, it seems there is always an analyst with a quot-able, ready explanation. Either interest rates areCited by: Macroeconomic Determinants of Real Exchange Rates William H.

Branson. NBER Working Paper No. Issued in November NBER Program(s):International Trade and Investment, International Finance and Macroeconomics This paper presents a model that integrates money, relative prices, and the current account balance as factors explaining movements in nominal (effective) exchange rates.

This study investigates the long-run fundamental determinants of the real effective exchange rate (REER) of the Bahraini dinar (BHD). The annual time series data were mostly collected from Author: Mita Suthar.

"This book greatly enhances our understanding of the behavior of real exchange rates. It provides an elegant model based on a solid theoretical foundation that links real exchange rates to their fundamental economic determinants and takes proper account of stock and flow by:   Hence they are the most followed, analyzed and often manipulated by government.

Thus many factors act as foreign exchange rate determinants. To better understand the 5 determinants of foreign exchange rates let us see how trade associations between countries are affected due to changes in the exchange rates. 15 The Theory of Exchange Rate Determination I The Stochastic Behavior of Exchange Rates and Related Variables Experience with floating exchange rates between the United States dollar and other major currencies (the British pound, the German mark, the FrenchCited by: The NATREX approach offers an alternative paradigm to the Purchasing Power Parity for equilibrium real exchange rates.

NATREX is the acronym for NATural Real EXchange, referring to a medium‐run, inter‐cyclical equilibrium real exchange rate, determined by real, fundamental factors. Importantly, the NATREX is a moving equilibrium real exchange rate, responding to continual changes in Author: Jerome L.

Stein. The purpose of this paper is to highlight the main determinants of the exchange rate from a monetary perspective. When the exchange rate is officially fixed, essentially the same monetary influences that determine the exchange rate affect the level of official settlements corresponding to the balance of payments surplus or : Anthony Makin.

This study evaluated determinants of nominal exchange rate fluctuations in Kenya because empirical test done in different countries in the world produce contradictory results, hence this create another research gap.

Therefore, there was need to estimate the nominal exchange rate determinants in Kenya hence the need of this study. exchange rate Exchange rate fluctuation is defined as the risk associated with unpredicted movements in exchange rate.

Macroeconomic variables such as interest rate, inflation rate, the balance of payments, tax rate etc influence the XR randomly. These macroeconomic variables are unstable and. On the most fundamental level, exchange rates are market-clearing prices that equilibrate supplies and demands in foreign exchange markets.

Obviously, it is the supply of, and the demand for, foreign currency that would determine at any time the rate of exchange of a country’s currency just as the market price of commodities is determined by the forces of demand and supply.

The Exchange Rate and Macroeconomic Determinants: Time-Varying Transitional Dynamics Chunming Yuan* Exchange Rate, Macroeconomic Determinants, the market responds to the updated news in the macro variables - deviation of the exchange rate from its fundamental value - and in turn alters the belief in the chance of the File Size: KB.

Interaction of imports and exports with the exchange rate can be self-correcting 3. As the Thai baht climbs, the price of Thai goods in euro terms rises and makes them less attractive. European consumers, if sensitive to the price change caused by the new exchange rate, may reduce overall Thai imports and lower demand for baht again.

One will get a good bit of argument, regardless of how one answers this question. In the Keynesian model, aggregate income is the primary determinant of aggregate consumption. This presumes that aggregate income is variable over time, rather than.

determinants of the exchange rate (Canales-Kriljenko & Habermeier, ). Consensus is seen on the theoretical importance of exchange rate depreciation or appreciation as an instrument for stimulation of a country’s trade (Krugman et al., ), however the volatility in.

The variables employed include: Average Official Exchange Rate of Naira vis-a-vis US Dollar and Nominal Effective Exchange Rate Indices, interest rate, inflation rate, Balance of Payment (BOP. influence exchange rate movements is needed (Kehinde, ).

Business Problem Among the risks firms experience are the volatility and difficulty in the prediction of exchange rates (Stockman, ).

Research on exchange rate determinants has provided a significant volume of analyses for variables affecting various currency pairs. These studies have. market structure variables to uncover structural determinants of pass-through. The paper finds that per capita GDP and inflation have positive effects on pass-through, while market volatility has a negative effect.

Among financial market variables exchange rate flexibility, credit quality, overhead costs, and banking competition were found toFile Size: 1MB.

Free-Floating Systems. In a free-floating exchange rate system System in which governments and central banks do not participate in the market for foreign exchange., governments and central banks do not participate in the market for foreign relationship between governments and central banks on the one hand and currency markets on the other is much the same as the typical.

Determinants of Exchange Rate Volatility: model indicates that more open economies have a more °exible aggregate price level. This °exibility reduces the efiect of unanticipated money supply shocks. It variables, the results state the impact of openness of an economy on exchangeCited by: Figure Determinants of exchange rates in the long run In addition, three other factors affect exchange rates in the long run: relative trade barriers, differential preferences for domestic and foreign goods, and differences in productivity.

Determinants of Foreign Exchange Market Long – term Factors Short-term Factors Long-term Factors • Balance of Payments • Strength of economy The relative strength of an economy has effect on demand and supply of foreign currencies.