The effect of monetary policy on real exchange rate misalignment

2001 ◽  
Vol 7 (1) ◽  
pp. 167-167
Author(s):  
Hossein S. Kazemi ◽  
Ayla Ogus
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Real Exchange Rate ◽  
Exchange Rate Misalignment ◽  
Effect Of Monetary Policy

scholarly journals Monetary Policy and the Predictability of Nominal Exchange Rates

2020 ◽  
Author(s):  
M S Eichenbaum ◽  
B K Johannsen ◽  
S T Rebelo
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Exchange Rates ◽  
Real Exchange Rate ◽  
Open Economy ◽  
Real Exchange Rates ◽  
Nominal Exchange Rate ◽  
Medium Size ◽  
Inflation Rates ◽  
Nominal Exchange Rates

Abstract This article studies how the monetary policy regime affects the relative importance of nominal exchange rates and inflation rates in shaping the response of real exchange rates to shocks. We document two facts about inflation-targeting countries. First, the current real exchange rate predicts future changes in the nominal exchange rate. Second, the real exchange rate is a poor predictor of future inflation rates. We estimate a medium-size, open-economy DSGE model that accounts quantitatively for these facts as well as other empirical properties of real and nominal exchange rates. The key estimated shocks that drive the dynamics of exchange rates and their covariance with inflation are disturbances to the foreign demand for dollar-denominated bonds.

scholarly journals Real exchange rate misalignment: Prelude to crisis?

2006 ◽  
Vol 30 (3) ◽  
pp. 207-230 ◽  
Author(s):  
David M. Kemme ◽  
Saktinil Roy
Keyword(s):  
Exchange Rate ◽  
Real Exchange Rate ◽  
Exchange Rate Misalignment
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