This paper studies the effect of external vulnerability indicators on the implied foreign exchange rate volatility … that (i) market participants expect a lower future volatility in response to a decrease in current account deficit or an … certain threshold), both external vulnerability indicators imply a stronger effect on the future expected volatility (around …

developed countries show quite robust import growth. Post-GFC, the exchange rate volatility has grown significantly. As … export growth as much as conventional wisdom dictates. On the other hand, countries with appreciating currencies show rising … import intensity and significant export growth. This implies that the more countries undergo currency devaluation - the …