The euro–dollar exchange rate defies prediction

Salvatore, Dominick

doi:10.1016/j.jpolmod.2005.04.011

Cited by 14 publications

(4 citation statements)

References 4 publications

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“…These contrasting views have their foundation in theoretical literature. The traditional approach to exchange rate holds that devaluation has expansionary effects on the economy (Salvatore, 2005). The Structuralist approach to exchange rates, on the other hand, is equally convincing that devaluation is contractionary to expansion in the economy (Acar, 2000).…”

Section: A Review Of Relevant Literaturementioning

confidence: 99%

Investigating the Impacts of Real Exchange Rates on Economic Growth: A Case study of South Africa.

Sibanda¹,

Ncwadi

Mlambo

2013

MJSS

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This paper examines the impact of real exchange rates on economic growth in South Africa. The paper uses quarterly time series data for the period of 1994 to 2010. The Johansen cointegration and vector error correction model is used to determine the impact of real exchange on economic growth in South Africa. The explanatory variables in this paper are real exchange rates, real interest rates, money supply, trade openness and gross fixed capital formation. Results of the study reveals that real exchange rates have a dampening long run impact on economic growth in South Africa. From the regression results, it is noted that undervaluation of the currency significantly hampers growth in the long run, whilst it significantly enhances economic growth in the short run. As such, the policy of depreciating exchange rates to achieve higher growth rates is only effective in the short run and is not sustainable in the long run. Based on the findings of this study, the authors recommend that misalignment (overvaluation and undervaluation) of the currency should be avoided at all costs. In addition, the results of the study shows that interest rates also have a significant impact on growth and since interest rates have a bearing on the exchange rate, it is recommended that the current monetary policy of inflation targeting be maintained in South Africa.

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Section: A Review Of Relevant Literaturementioning

confidence: 99%

Investigating the Impacts of Real Exchange Rates on Economic Growth: A Case study of South Africa.

Sibanda¹,

Ncwadi

Mlambo

2013

MJSS

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“…Döviz kurunun büyüme üzerinde olumlu etkisi olduğunu savunan çalışmalar devalüasyonun genişletici etkisi üzerine odaklanmaktadır (Salvatore, 2005). Devalüasyon dış ticaret dengesini iyileştirerek, istihdam ve büyümeyi arttıracaktır (Acar, 2000).…”

Section: Literatürunclassified

Covid -19 Pandemi Sürecinde Döviz Kurunun Büyüme Üzerindeki Etkisi: Kırgızistan Örneği

ÖSKÖNBAYEVA¹,

Najimudinova²

2022

javs

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Özet 2019 yılında Çin'in Wuhan şehrinde ortaya çıkan Covid-19 virüsü kısa zamanda tüm dünyaya yayılmıştır. Söz konusu salgın tüm ülkelerin makro iktisadi performansını derinden etkilemiştir. Covid-19'un iktisadi etkileri sektörler ve ülkeler arasında önemli derecede hissedilmektedir. Pandemi sağlık başta olmak üzere hayatımızın tüm alanlarını olumsuz etkilemeye devam etmektedir. Alınan tedbirlere rağmen Covid-19 dünya ekonomilerini ciddi bir durgunluğa sürüklemeye devam etmektedir. Bu çalışmada Covid-19 döneminde Kırgızistan'da döviz kurunda meydana gelen değişimlerin iktisadi büyüme üzerindeki etkisini incelemektir. Bu amaç doğrultusunda söz konusu ülkenin 2018-2020 dönemine ait aylık verileri kullanılmıştır. İktisadi büyüme ve döviz kuru değişkenleri Kırgız Cumhuriyeti Merkez Bankası veri tabanından temin edilmiştir. Ampirik uygulamada Pesaran ve Shin (1999) ve Pesaran ve diğerleri (2001) tarafından geliştirilen ARDL (Gecikmesi Dağıtılmış Otoregresif Model) sınır testi yaklaşımı uygulanmıştır. Elde edilen bulgular ışığında Kırgızistan'da Covid-19 döneminde döviz kurunun iktisadi büyümeyi önemli düzeyde etkilediği söylenebilir. Araştırma bulgularının, Covid-19 döneminde döviz kurunun ekonomik büyüme üzerindeki etkilerine ışık tutacağı düşünülmektedir.

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“…The traditional approach holds that devaluation increases the growth rate of a country. This implies that when the exchange rate is devalued, domestic goods become inexpensive overseas, which in turn, raises their demand, thus resulting in a growth in exports (Salvatore, 2005). According to this method, aggregate demand determines output whereby, depreciation positively influences and encourages aggregate demand and output (Genye, 2011).…”

Section: The Traditional Approachmentioning

confidence: 99%

Relationship between Real Exchange Rate and Economic Growth: the case of South Africa

Patel¹,

Mah²

2018

JEBS

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The objective of this study was to investigate the relationship between real exchange rate and economic growth in South Africa. Using time series data, the period from 1980 to 2015 was covered in the study. Data was collected from the South African Reserve Bank, the International Monetary Fund and International Financial Statistics. The Johansen cointegration and the Vector Error Correction Model estimation techniques were employed in the study, followed by VEC Granger causality test, variance decomposition and impulse response function. The long-run results revealed a negative and significant relationship between real exchange rate with export and economic growth. On the other hand, money supply and foreign direct investment have a positive and significant relationship with real exchange rate. Only export was significant and positively related to real exchange rate in the short-run. Results of granger causality showed that only export granger causes real exchange rate thus, a unidirectional causality exists between export and real exchange rate. Results of variance decomposition revealed that the real exchange rate is highly affected by shocks from economic growth. The impulse response functions showed that real exchange rate responds positively to shocks from real exchange rate and money supply. On the contrary, real exchange rate responds negatively to a shock from economic growth. There is, therefore, a need to increase exports, money supply, foreign direct investment and economic growth as these would lead to an increase in the Rand and consequently, appreciation of the Rand.

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The euro–dollar exchange rate defies prediction

Cited by 14 publications

References 4 publications

Investigating the Impacts of Real Exchange Rates on Economic Growth: A Case study of South Africa.

Investigating the Impacts of Real Exchange Rates on Economic Growth: A Case study of South Africa.

Covid -19 Pandemi Sürecinde Döviz Kurunun Büyüme Üzerindeki Etkisi: Kırgızistan Örneği

Relationship between Real Exchange Rate and Economic Growth: the case of South Africa

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