Exchange Rate Overshooting in Iran

2014 ◽  
Vol 2 (3) ◽  
pp. 38-43
Author(s):  
Ali Haghighat ◽  
Tahereh Shojaei
Keyword(s):  
Exchange Rate ◽  
Exchange Rate Overshooting

scholarly journals Exchange Rate Overshooting and the Costs of Floating

2005 ◽  
Author(s):  
Michele Cavallo ◽  
Kate Kisselev ◽  
Fabrizio Perri ◽  
Nouriel Roubini
Keyword(s):  
Exchange Rate ◽  
Exchange Rate Overshooting

Exchange Rate Overshooting

2009 ◽  
pp. 87-94
Author(s):  
John E. Floyd
Keyword(s):  
Exchange Rate ◽  
Exchange Rate Overshooting

Financial Panic and Exchange Rate Overshooting during Currency Crises

2007 ◽  
Vol 21 (1) ◽  
pp. 71-89 ◽  
Author(s):  
Soyoung Kim ◽  
Sunghyun Henry Kim
Keyword(s):  
Exchange Rate ◽  
Currency Crises ◽  
Financial Panic ◽  
Exchange Rate Overshooting

scholarly journals Monetary policy and exchange rate overshooting: Dornbusch was right after all

2009 ◽  
Vol 79 (1) ◽  
pp. 64-77 ◽  
Author(s):  
Hilde C. Bjørnland
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Exchange Rate Overshooting

EXCHANGE RATE OVERSHOOTING: REPLY AND FURTHER CLARIFICATIONS

1984 ◽  
Vol 52 (4) ◽  
pp. 425-430 ◽  
Author(s):  
JAGDEEP S. BHANDARI
Keyword(s):  
Exchange Rate ◽  
Exchange Rate Overshooting

Noise trading and delayed exchange rate overshooting

2005 ◽  
Vol 58 (1) ◽  
pp. 133-156 ◽  
Author(s):  
Christian Pierdzioch
Keyword(s):  
Exchange Rate ◽  
Noise Trading ◽  
Exchange Rate Overshooting

scholarly journals Real Exchange Rate Overshooting in Large Depreciations

2020 ◽  
Vol 20 (60) ◽  
Author(s):  
Alexander Culiuc
Keyword(s):  
Exchange Rate ◽  
Real Exchange Rate ◽  
Trade Openness ◽  
Balance Sheet ◽  
Relative Strength ◽  
Medium Term ◽  
Ex Post ◽  
Expenditure Switching ◽  
Output Losses ◽  
Exchange Rate Overshooting

The consequences of large depreciations on economic activity depend on the relative strength of the contractionary balance sheet and expansionary expenditure switching effects. However, the two operate over different time horizons: the balance sheet effect hits almost immediately, while expenditure switching is delayed by nominal rigidities and other frictions. The paper hypothesizes that the overshooting phase—observed early in the depreciation episode and driven by the balance sheet effect—is largely irrelevant for expenditure switching, which is more closely aligned with ex-post equilibrium depreciation. Given this, larger real exchange rate overshooting should signal a relatively stronger balance sheet effect. Empirical findings support this hypothesis: (i) overshooting is driven by factors associated with the balance sheet effect (high external debt, low reserves, low trade openness), (ii) overshooting-based measures of the balance sheet effect foreshadow post-depreciation output losses, and (iii) the balance sheet effect is strongest early on, while expenditure switching strengthens over the medium term.

scholarly journals In Search of Exchange Rate Undershooting in Pakistan

2021 ◽  
Vol 2 (2) ◽  
pp. 141-160
Author(s):  
Wajiha Haq Haq ◽  
Iftikhar Hussain Adil
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Money Supply ◽  
Full Employment ◽  
Vector Autoregressive ◽  
Long Run ◽  
Supply Shock ◽  
Price Rigidities ◽  
Exchange Rate Overshooting ◽  
Insight Into

Exchange rate behaviour does not follow very obvious and predicted pattern. Many attempts have been made to predict its behaviour as much as possible. This research re-examines the Dornbusch’s model of exchange rate overshooting caused by price rigidities. Dornbusch’s assumption of full employment in economy has been violated in this research which creates the possibility of exchange rate undershooting. In response to positive monetary shock, interest rate decreases and exchange rate undershoots its long run equilibrium. This research explains the dynamics of anti-intuitive exchange rate undershooting. Apart from theoretical formations of exchange rate undershooting, this research also analyses Pakistani data for exchange rate undershooting or overshooting in response to increase in money supply. Quarterly data of twenty three years for exchange rate, nominal interest rate, price, real output and money have been taken and vector autoregressive technique has been used. Evidence of exchange rate undershooting in response to positive money supply shock was found. It also gives an important insight into policy making by identifying some probable behaviour of exchange rate.

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