scholarly journals The Relative City Price Convergence in Pakistan: Empirical Evidence from Spatial GLS

2010 ◽  
Vol 49 (4II) ◽  
pp. 439-448 ◽  
Author(s):  
Hasan Muhammad Mohsin ◽  
Scott Gilbert
Keyword(s):  
Exchange Rates ◽  
Price Index ◽  
Common Knowledge ◽  
Real Exchange Rates ◽  
Consumer Price Index ◽  
Market Price ◽  
Commodity Prices ◽  
Trade Barriers ◽  
Price Convergence ◽  
Tradable Goods

It is evident from general experience that price of same good may differ considerably among countries, regions, cities in same country and even adjacent shopping malls and outlets. It is also common knowledge that stronger competitive forces and information about market price tend to ensure convergence of prices. In the presence of these forces price differentials cannot be persistent and are hence short lived. The recent literature on price convergence has focused on country studies using regional commodity prices and Consumer Price Index (CPI) data.1 The analysis of relative prices or real exchange rates between regions or cities in a country has certain advantages in estimating Purchasing Power Parity (PPP) puzzle. There are no trade barriers and non tradable goods in a single country. Krugman and Obstfeld (2007) consider transportation costs, trade barriers and goods market segmentations as obstacles to hold international Ppp.Furthermore they mention that countries have different endowments, baskets of goods and consumption weights in their inflation index. So PPP may not hold even if there are no non tradable goods and barriers. The PPP theory is related to the law of one price through arbitrage of international goods. The estimation of real exchange rates among countries shows that the convergence towards PPP is very slow.2 This study attempts to use overall Consumer Price Index (CPI) data on 35 Pakistani cities from July 2001 to June 2008 to estimate relative city price convergence with Karachi and Lahore, two numeraire cities. The case of Pakistan is interesting primarily due to the following reasons.

scholarly journals Consumer Price Index (CPI) as a competitiveness inflation measure: Evidence from Jordan

2019 ◽  
Vol 8 (2) ◽  
pp. 17-22
Author(s):  
Osama Samih Shaban ◽  
Mohammad Al-Attar ◽  
Zaid Al-hawatmah ◽  
Nafez Nimer Ali
Keyword(s):  
Exchange Rate ◽  
Correlation Analysis ◽  
Exchange Rates ◽  
Price Index ◽  
Pearson Correlation ◽  
Real Exchange Rates ◽  
Empirical Relationship ◽  
Consumer Price Index ◽  
The Real ◽  
Inflation Rates

The purpose of this paper is to investigate the Consumer Price Index (CPI) as a competitiveness inflation measure and to determine whether an empirical relationship exists between the rates of inflation represented in CPI and the level of the real exchange rate. In order to achieve the objectives of this paper, the study calculated the consumer price index (CPI) as an inflation rate for the period 2010-2018, and also adopted the real exchange rates for the same period. In order to achieve the objectives of the study, a Pearson correlation analysis between the average CPI rates, and the average exchange rate were conducted. The outcomes of the correlation analysis conducted reflect a negative correlation of 62% between the exchange rates and the CPI’s inflation rates, which means that when CPI rates cause direct opposite effect of the determination level of exchange rates on the Jordanian economy.

Real Exchange Rates and Commodity Prices

1996 ◽  
Author(s):  
Dominique Yves Dupont ◽  
V. Hugo Juan-Ramon
Keyword(s):  
Exchange Rates ◽  
Real Exchange Rates ◽  
Commodity Prices

Purchasing Power Parity and the Law of One Price: Evidence from Commodity Prices in Asian Countries

2015 ◽  
Vol 15 (2) ◽  
pp. 231-240 ◽  
Author(s):  
Mohsen Bahmani-Oskooee ◽  
ABM Nasir
Keyword(s):  
Exchange Rates ◽  
Purchasing Power Parity ◽  
Real Exchange Rates ◽  
Strong Support ◽  
Commodity Prices ◽  
Law Of One Price ◽  
Purchasing Power ◽  
Power Parity ◽  
Industrial Countries ◽  
The Law

Almost all previous studies that have tested the law of one price or Purchasing Power Parity theory (PPP) have used either real effective exchange rates or bilateral real exchange rates which are constructed using CPI or PPI data. Most of these studies have failed to support the PPP mostly due to aggregation bias. A few recent studies, have, therefore used commodity prices in different countries and have provided strong support for the theory. These studies have mostly used data from industrial countries. In this paper, we use individual prices of 52 retail items from 15 cities in Asia and test for stationarity of the real exchange rate and speed of adjustment. We provide support for PPP in 63% of the cases. We also find that using individual prices lead to faster convergence of real rates toward their PPP values.

Real Exchange Rates and Commodity Prices

1996 ◽  
Vol 96 (27) ◽  
pp. 1 ◽  
Author(s):  
Dominique Yves Dupont ◽  
V. Hugo Juan-Ramon ◽  
◽  
Keyword(s):  
Exchange Rates ◽  
Real Exchange Rates ◽  
Commodity Prices

scholarly journals FORMATION OF COMPOSITE GLOBAL COMMODITY PRICES AS AN INFLATION INDICATOR FOR EAST JAVA

2021 ◽  
Vol 2 (2) ◽  
pp. 210-217
Author(s):  
Anisha Wirasti Cahyaningrum
Keyword(s):  
Exchange Rate ◽  
Price Index ◽  
Consumer Price Index ◽  
Relative Weight ◽  
Commodity Prices ◽  
Commodity Price ◽  
Data Availability ◽  
General Will ◽  
The Exchange Rate ◽  
The Impact

With the average contribution of imports to Gross Regional Domestic Product (GRDP) in the last five years reaching 19.1%, the dynamics of global commodity prices also influence the economic performance of East Java, including the movement of inflation. A composite indicator of global commodity prices is needed to find out the impact of changes in various global commodity prices on inflation in East Java. By adopting the Bank Indonesia methodology in forming a composite global price known as the Imported Inflation Price Index (IHIM) which has considered the method of forming a global composite price created by the IMF (IMF Commodity Price Index), the compilation of East Java global price composites also examines the accuracy of commodity selection and aspects of data availability. The selected global price composite for East Java is a composite of seven global commodities which include food (wheat, soybeans, corn and CPO) and non-food (iron, gold and oil). These are two aspects determining the relative weight, namely (I) the import portion of the total input based on the Input-Output table and (ii) the commodity weight of derivatives in the East Java Consumer Price Index (IHK) basket. Furthermore, with OLS regression, the composite of East Java global commodity prices affects the core-traded inflation movement in East Java. Thus, the composite of global commodity prices in East Java can be used as an indicator of East Java inflation projections, especially core-traded inflation. This study, in general, will also examine the effect of the exchange rate impact on the movement of core inflation, especially traded groups in East Java. Based on the regression results it is known that the impact of the exchange rate movement on core traded inflation in East Java is more significant than the effect of world commodity price movements.

scholarly journals Analisis Perkembangan Indeks Harga Konsumen di Kota Medan

2020 ◽  
Vol 3 (2) ◽  
pp. 412-418
Author(s):  
Sari Wulandari ◽  
Muhammad Dani Habra
Keyword(s):  
Price Index ◽  
Inflation Rate ◽  
Consumer Price Index ◽  
Commodity Prices ◽  
Household Expenditure ◽  
The Public ◽  
Goods And Services ◽  
City Community ◽  
The Subject ◽  
The City

The Consumer Price Index (CPI) is one of the important economic indicators that can provide information about the development of prices of goods and services (commodities) paid by consumers or the public especially the city community. This study aims to analyze the Development of the Consumer Price Index in Medan City. The benefits of this research are a description of the fluctuations in commodity prices for basic needs of the community at the level of consumers or retail traders. This type of research is descriptive qualitative. The subject in this study is the Central Statistics Agency and the object in this study is the Consumer Price Index through seven groups of household expenditure in 2018-2019. The results showed that the development of price indices in Medan City tends to fluctuate from seven types of household expenditure groups. During the January-December 2019 period the highest inflation of the seven types of expenditure was foodstuffs. Keywords: Consumer Price Index, Inflation Rate

scholarly journals Real Exchange Rates and Primary Commodity Prices

2019 ◽  
Author(s):  
Joao Ayres ◽  
Constantino Hevia ◽  
Juan Pablo Nicolini
Keyword(s):  
Exchange Rates ◽  
Real Exchange Rates ◽  
Commodity Prices ◽  
Primary Commodity

scholarly journals The Impact of Australian Consumer Price Index on the Exchange Rate of Australian Dollar - Chinese Renminbi

2017 ◽  
Vol 13 (22) ◽  
pp. 12
Author(s):  
Maoguo Wu ◽  
Yue Yu
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Price Index ◽  
Consumer Price Index ◽  
Asia Pacific ◽  
Steady Increase ◽  
Australian Dollar ◽  
Chinese Investment ◽  
The Exchange Rate ◽  
The Impact

This paper investigates the impact of Australian consumer price index on Australian dollar - Chinese renminbi exchange rate. As two major economies in Asia Pacific, China and Australia are conducting ever-increasing volume of economic transactions. Massive Chinese investment, particularly in properties, has caused steady increase in Australian consumer price index and the exchange rate of Australian dollar - Chinese renminbi. Recent slowdown of Chinese economic growth and Chinese investment in Australia caused both Australian consumer price index and the exchange rate of Australian dollar - Chinese renminbi to fall significantly. This paper utilizes data from May 2005 to January 2016 and empirically tests the relation between Australian consumer price index and the exchange rate of Australian dollar - Chinese renminbi. In compliance with classical theories of exchange rates, empirical results find that a negative relation exists between Australian consumer price index and the exchange rate of Australian dollar - Chinese renminbi.

scholarly journals Effect of Exchange Rate, Foreign Exchange Reserves, and Consumer Price Index on the Shariah Shares Index of Asian Countries

2020 ◽  
pp. 77-82
Author(s):  
Dolly Tanzil ◽  
◽  
Marlina Widiyanti ◽  
Muhammad Subardin ◽  
◽  
...  
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Foreign Exchange ◽  
Price Index ◽  
Consumer Price Index ◽  
Stock Index ◽  
Asian Countries ◽  
Foreign Exchange Reserves ◽  
Operating Income ◽  
The Exchange Rate

Sharia shares are securities proof of equity participation in a company. On the base of this proof of participation shareholders are entitled to a share of income arisen from the company's business. This concept of equity participation with share rights of operating income does not conflict with Sharia principles. This study aimed to analyze the effect of exchange rate, foreign exchange reserves and consumer price index on the Sharia stock index of Asian countries, where the research object was the Islamic stock index of Indonesia, Malaysia, Japan and India. It is known that many factors influence on the stock index movements in a country, including domestic interest rates, foreign exchange rates, international economic conditions, a country's economic cycle, inflation rates, tax regulations, and the money supply. In this study, the authors examine the influence of only three factors – the exchange rate, foreign exchange reserves and consumer price index. The panel data regression method was used for the period of January to December 2019. The results of the regression analysis shown that the variables of exchange rates, foreign exchange reserves and the consumer price index together had a significant effect on the Islamic stock index of Asian countries. The R-squared value was 0.997762, meaning that 99% of the variation in the Islamic stock index of Asian countries could be explained by variations in the variable exchange rates, foreign exchange reserves and the consumer price index. The individual test results show that the exchange rate had a significant negative effect on the Islamic stock index of Asian countries. Meanwhile, foreign exchange reserves and the consumer price index had a significant positive effect on the Islamic stock index of Asian countries.

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