The Swedish real exchange rate under different currency regimes

Larsson, Anna

doi:10.1007/bf02659621

Cited by 5 publications

(3 citation statements)

References 14 publications

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“…Bahmani-Oskooee and Goswami (2005) explores that domestic and foreign price levels are not weakly exogenous in many countries. Larsson (2004) investigates the affiliation of Swedish real exchange rate with other currency regimes like Germany, this study is concluded with the support of Unit root test, cointegration, and ECM that there is long term association (cointegration) between real exchange rate and productivity of Sweden and Germany. But at the same time in the short run, the exchange rate regime has subjected for the dynamics of the real exchange rate.…”

Section: Empirical Studiesmentioning

confidence: 65%

How does interest rate effect exchange rate of Pakistan: Evidence of ARDL bound testing approach

Ali¹

2016

j.financ.econ.res

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The purpose of this paper is to examine the long run as well as the short run relationship between exchange rate and interest rate in the context of Pakistan. Annual time series data have been used over the period of 1980 to 2015. Augmented Dickey-Fuller (ADF) unit root test, Johansen and Jeuuselius's cointegration technique, auto regressive distributed lag (ARDL) bound testing model, error correction model (ECM), CUSUM and CUSUM of square tests for stability of model and, causality analysis in supporting variance decomposition are used to meet the research purpose. The study concluded the existence of a significant positive relationship between exchange rate and interest rate in the long run as well as in the short run in the context of Pakistan. These results are consistent with theoretical aspects. It is suggested that Pakistan should form economic, policies, especially monetary policy, keeping view the relationship between exchange rate and interest rate.

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Section: Empirical Studiesmentioning

confidence: 65%

How does interest rate effect exchange rate of Pakistan: Evidence of ARDL bound testing approach

Ali¹

2016

j.financ.econ.res

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“…Larsson (2002) tests this and finds some support for a regime-dependent behavior in the SEK/DEM real exchange rate. 10 The constants are unknown since we do not know from the estimated equations what part of the estimated constant pertains to the cointegrating relation.…”

Section: Real Exchange Ratesmentioning

confidence: 84%

A Simultaneous Model of the Swedish Krona, the US Dollar and the Euro

Sellin

Lindblad

2007

SSRN Journal

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In this paper we simultaneously estimate the real exchange rates between the Swedish Krona, the US Dollar and the Euro. A prime candidate for explaining the exchange rate movements is relative potential output. Since this variable is unobservable, cyclical and potential output are estimated in an unobserved components framework together with a Phillips curve. Our empirical exchange rate results are in line with theory. Increases in relative potential output and the terms of trade strengthen the exchange rate, while a relative increase of the fraction of middle-aged people in the population and budget deficits depreciate the exchange rate. The estimates suggest that the recent deterioration of the relative budget situation for the US versus Europe is a prime candidate for explaining the USD/EUR exchange rate change lately.

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“…Clarida and Prendergast (1999) analyse dynamic effects of fiscal policy shocks on the real exchange rate for Germany, US, and Japan, and they find that the real exchange rate appreciates for several years after an expansionary fiscal shock. Larsson (2002) finds that higher growth in Swedish log government consumption relative to German log government consumption causes a nominal depreciation under a floating regime, who is playing a role as a shock absorber. Furthermore, Chinn (1997) finds evidence of cointegration between the real exchange rate, manufacturing productivity and government spending for the Canadian Dollar, the Deutschemark, Yen and Pound.…”

Section: A Simple Model Of Fixed Exchange Rates and Fiscal Policymentioning

confidence: 98%

Exchange Rate Pegs, Fiscal Policy and Credibility

Andersen

Chiriaeva

2007

Open Econ Rev

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In a fixed exchange rate regime, an exchange rate change can be a swift way to change the real exchange rate in the short run. Fiscal policy also affects relative prices, and fiscal policy response to various types of shocks can therefore be crucial for the credibility of an exchange rate peg. We develop a model within which fiscal policy plays a crucial role for ensuring the viability and thus credibility of an exchange rate peg. We use the insights of this model to take a closer look at Denmark, which has successfully pursued a fixed exchange rate policy since 1982. Copyright Springer Science+Business Media, LLC 2007Credibility, Exchange rate regimes, Fiscal policy, Target zones, The EMS crisis, F31, F33, F41,

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The Swedish real exchange rate under different currency regimes

Abstract: Real exchange rate, exchange rate regimes, cointegration,

Cited by 5 publications

References 14 publications

How does interest rate effect exchange rate of Pakistan: Evidence of ARDL bound testing approach

How does interest rate effect exchange rate of Pakistan: Evidence of ARDL bound testing approach

A Simultaneous Model of the Swedish Krona, the US Dollar and the Euro

Exchange Rate Pegs, Fiscal Policy and Credibility

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