This study analyzes the dynamics between real effective exchange rates and current account patterns from a novel perspective. We start by dissecting long-run and time-varying short-run dynamics between both variables. Following this, we extend our framework by including interest rates into our...

This study proposes to investigate the link between Real Exchange Rate and Economic Growth in ten Asia - Pacific countries and aims to study how Real Exchange Rate (RER) and Economic Growth (EG) were related to each other. This study decomposed the linear relationship between RER and Economic...

The main purpose of this study is to examine the causal relationship between Real Exchange Rate and Economic Growth Variables in the Asia – Pacific region. Granger Causality Test was employed, to examine the causal relationship between the dependent and independent variables, with the sample...

This paper presents new stylized facts about exchange rates and their relationship with macroeconomic fundamentals. We show that macroeconomic surprises explain a large majority of the variation in nominal exchange rate changes at a quarterly frequency. Using a novel present value decomposition...

This paper presents new stylized facts about exchange rates and their relationship with macroeconomic fundamentals. We show that macroeconomic surprises explain a large majority of the variation in nominal exchange rate changes at a quarterly frequency. Using a novel present value decomposition...

The first part of this paper briefly summarizes the assumptions of economic theory on the relationships between exchange rates, prices and interest rates and the same time compares these assumptions with the empirical evidence. The fact that there exist strong discrepancies, which in recent...