scholarly journals Exchange Rate Modeling: Medium-Term Equilibrium Dynamics

2019 ◽  
Vol 4 (4) ◽  
pp. 251-255 ◽  
Author(s):  
Anton Kuzmin
Keyword(s):  
Exchange Rate ◽  
Medium Term ◽  
Equilibrium Dynamics ◽  
Modeling Medium

scholarly journals Russian ruble exchange rate: Modeling of comparative medium-term and long-term dynamics

2021 ◽  
Vol 25 (6) ◽  
pp. 6-15
Author(s):  
A. Yu. Kuzmin
Keyword(s):  
Mathematical Modeling ◽  
Exchange Rate ◽  
Mathematical Analysis ◽  
System Analysis ◽  
Equilibrium Exchange Rate ◽  
Medium Term ◽  
Conceptual Approach ◽  
Equilibrium Dynamics ◽  
Functional Relationships

The subject of the study is the dynamic mechanism of the formation of the exchange rate of the Russian ruble in a multilevel system of economic fundamental determinants-aggregates in the context of the independent floating rate of the national currency. The aim of the study is to develop the author’s theoretical and methodological conceptual approach to modeling the dynamics of the equilibrium exchange rate based on international flows (IFEER) and to develop a new model of the Russian ruble exchange rate dynamics on its basis. The methodological base of the research includes system analysis, fundamental methods of economic theory, classical methods of mathematical analysis, and economic and statistical analysis, and the provisions of national accounting. The paper presents data on the verifcation of the results of modeling mediumterm equilibrium dynamics. At the same time, the author pays considerable attention to the mathematical modeling of the long-term dynamics of the ruble exchange rate in comparison with the medium-term equilibrium dynamics and the mathematical analysis of internal functional relationships in modern conditions, which determines the scientifc novelty and relevance of the study. Based on the conducted mathematical modeling, the author concludes about the trends of a stronger ruble exchange rate in the long run, while maintaining the current long-term trends.

scholarly journals FX Intervention to Stabilize or Manipulate the Exchange Rate? Inference from Profitability

2020 ◽  
Vol 20 (90) ◽  
Author(s):  
Damiano Sandri
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Medium Term ◽  
The Face ◽  
Exchange Rate Misalignment ◽  
The Exchange Rate ◽  
Fundamental Values ◽  
Shed Light

We analyze the profitability of FX swaps used by the central bank of Brazil to shed light on the rationale for FX intervention. We find that swaps are profitable in expectation, suggesting that FX intervention is used to stabilize the exchange rate in the face of temporary excessive movements rather than to manipulate it away from fundamental values. In line with this interpretation, we find that the scale of FX intervention responds to the degree of exchange rate misalignment relative to UIP conditions. We also document that intervention is more aggressive when there is less uncertainty about the medium-term level of the exchange rate and when the exchange rate is overvalued rather than undervalued.

Chapter 1. The Home Economy

1989 ◽  
Vol 127 ◽  
pp. 7-25
Keyword(s):  
Exchange Rate ◽  
Interest Rates ◽  
Balance Of Payments ◽  
Medium Term ◽  
Short Term ◽  
Regional Pattern ◽  
Economic Cycles ◽  
The Past ◽  
Alternative Scenarios

On this occasion we have adopted a rather different format for this chapter from the customary one. Part One begins with an analysis of some of the most important developments of the past few years, with notes on the deterioration in the balance of payments, on the fall in the savings ratio and on the acceleration of inflation. Next we discuss some of the problems associated with economic forecasting. We analyse the errors made last year and compare them with the error margins normally associated with short-term forecasts of this kind. We look at the behaviour of the economy at the corresponding stage of previous economic cycles. And we consider the best way of forecasting GDP when there are discrepancies between the measures of its growth in the past. Our central forecasts for 1989 and 1990 are described briefly in the text of Part Two, and more fully set out in the usual tables. We end in Part Three with a discussion of alternative scenarios for the medium term, with particular reference to their implications for interest rates and the exchange rate. An appendix describes the regional pattern of unemployment and the way it has changed since the early 1980s.

Hong Kong and Denmark will keep currency pegs

2015 ◽  
Keyword(s):  
Hong Kong ◽  
Exchange Rate ◽  
Foreign Exchange ◽  
Medium Term ◽  
Content Type ◽  
The Us ◽  
Exchange Rate Arrangements ◽  
Exchange Markets ◽  
Us Dollar ◽  
Currency Pegs

Subject The longevity and outlook for currency pegs. Significance The abandonment of the Swiss franc's three-year-old peg to the euro on January 15 put into question the longevity of pegged exchange rate arrangements. It also highlights how unusual such arrangements are today. Impacts The SNB will still have to continue to intervene in foreign-exchange markets to stabilise the Swiss franc. The SNB move will not cause Danish authorities to stop pegging the Danish krone to the euro. The near- and medium-term longevity of the Hong Kong dollar peg to the US dollar will not be questioned.

IMF loan conditions will worsen Egyptian discontent

2016 ◽  
Keyword(s):  
Exchange Rate ◽  
Economic Crisis ◽  
Economic Conditions ◽  
Market Exchange ◽  
Medium Term ◽  
Content Type ◽  
Political Dissent ◽  
Market Exchange Rate ◽  
Economic Collapse ◽  
The Government

Significance The government's struggle to stave off economic collapse has become increasingly frantic, as inflation has surged, the gap between the official and black market exchange rate has reached or exceeded 100%, and consumers have difficulty finding basics such as sugar and rice. Impacts Increased incidents of popular protests and political dissent reflect worsening economic conditions. Measures to be taken as part of the IMF deal, notably devaluation and further subsidy cuts, could exacerbate social and political tensions. Sisi will deflect some of the blame for the economic crisis onto the government and the central bank. If the government survives this crisis, the economy could recover in the medium term.

Monetary tightening carries high cost in Argentina

2018 ◽  
Keyword(s):  
Exchange Rate ◽  
Current Account Deficit ◽  
Public Spending ◽  
Medium Term ◽  
Content Type ◽  
Financial Volatility ◽  
Fiscal Adjustment ◽  
Debt Default ◽  
Floating Exchange Rate ◽  
The Government

Significance Despite its commitment to a floating exchange rate, the government has been forced to prioritise exchange rate stabilisation. After the change of Central Bank (BCRA) authorities in mid-June failed to stop the latest currency run, the government further tightened monetary policy. Aiming to alleviate fears of a new medium-term debt default, the government is emphasising its commitment to fiscal adjustment, even including the possibility of new taxes, which runs counter to efforts to reduce tax pressure. Impacts Interest rate rises and closer control of monetary aggregates may prompt a recession. Depreciation will help to reduce the current account deficit in 2018 but will worsen debt indicators. Growing political uncertainty and difficulty in cutting public spending will sustain financial volatility.

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.

Angolan oil sector reform will require innovation

2018 ◽  
Keyword(s):  
Exchange Rate ◽  
Foreign Exchange ◽  
Oil Price ◽  
Structural Reforms ◽  
Medium Term ◽  
Short Term ◽  
Sector Reform ◽  
Content Type ◽  
Oil Sector ◽  
Oil Company

Subject Sonangol priorities. Significance Early structural reforms by new President Joao Lourenco and more positive economic projections for 2018 suggest a potential uptick in Angola’s fiscal fortunes. Since assuming power in September, Lourenco has overhauled the leadership of state-owned oil company Sonangol and dismissed several prominent officials associated with his predecessor Jose Eduardo dos Santos. Separately, Lourenco has moved to tackle the overvalued kwanza. While this will raise debt-servicing costs, this will be partly ameliorated by the recent oil price of over 60 dollars per barrel. Impacts Scrapping the dollar currency peg will help ease the foreign exchange crisis and end payment constraints in the aviation and oil sectors. A more realistic exchange rate will fuel inflation in the short term but will likely improve medium-term economic prospects. Urban support for the People's Movement for the Liberation of Angola (MPLA) could decline further if reforms remain elite-focused.

scholarly journals Estimation of the development of the Euro to Chinese Yuan exchange rate using artificial neural networks

2019 ◽  
Vol 61 ◽  
pp. 01030 ◽  
Author(s):  
Marek Vochozka ◽  
Jaromír Vrbka
Keyword(s):  
Artificial Intelligence ◽  
Neural Networks ◽  
Time Series ◽  
Exchange Rate ◽  
Financial Institutions ◽  
Current Status ◽  
Medium Term ◽  
Future Developments ◽  
Long Run ◽  
Chinese Yuan

The exchange rate is one of the most monitored economic variables, from the position of individual citizens or economists, financial institutions or entrepreneurs. In the long run, it is a reflection of the condition of the economy, and in the short and medium term it has a significant impact on the economy. The time series of currency development maps past developments, current status, and is also able to predict future developments. This article analyzes the time series of the development of EUR to Yuan exchange rate using artificial intelligence. It aims to evaluate this development and to indicate the prediction of the future development of EUR to Yuan.

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