scholarly journals The relationship between petroleum price and real exchange rate: an example of Iraq

2021 ◽  
Vol 11 (1) ◽  
pp. 12-17
Author(s):  
Dindar Saeed Saeed ◽  
Sadeq Taha Abdulazeez ◽  
Sarbast Kamal Rasheed ◽  
Rogash Younis Masiha ◽  
Diyar Hashim Malo
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Real Exchange Rate ◽  
Unit Root Test ◽  
Causality Analysis ◽  
Petroleum Price ◽  
Energy Product ◽  
The World ◽  
The Exchange Rate ◽  
The Relationship

Petroleum is one of the world's most important economic products. It is widely accepted that petroleum is not only an energy product, but also a financial asset. Therefore, it is important to understand the dependence of petroleum prices on economic conditions and financial markets and how they can affect the world economy. The fluctuations in world petroleum prices affect the economies of petroleum importing countries through different channels. One of the most important of these influence channels is the exchange rate. Because changes in exchange rates cause different economic problems in fragile economies. Changes in petroleum prices affect the economic performance of any country through various channels. One of the channels of influence is exchange rates. Petroleum prices affect the transfer of income from petroleum exporting countries to petroleum importing countries through trade and thus determine the exchange rate. In this study, the Relationship between Petroleum Price and Real Exchange Rate in Iraq was examined by ADF unit root test, Johansen-Juselius cointegration test and Granger causality analysis. For the analysis, the Petroleum Price and Real Exchange Rate data of Iraq were taken from the official website of the World Bank and transferred to the Eviews 10 program and necessary analyzes were made. The results of the analysis were analyzed and interpreted in tables.

scholarly journals The COVID-19 Process and the Exchange Rate Relation: An Application on Turkey

2020 ◽  
Author(s):  
Eda Dineri ◽  
İbrahim Çütçü
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Structural Breaks ◽  
Health Problems ◽  
Cointegration Test ◽  
Causality Test ◽  
Economic Changes ◽  
The World ◽  
The Exchange Rate ◽  
The Impact

Abstract The recent shocks in supply and demand in the world are not due to unexpected economic reasons; in fact, they are related to Covid-19 that causes rapidly spreading global health problems and life threats around the world. While the global powers are dealing with the social problems created by Covid-19 pandemic, they should not neglect the economic changes created by this pandemic. The most important of these economic changes in developing countries with high fragility is exchange rates, because exchange rates can directly affect many macroeconomic variables, from inflation to foreign trade, from the balance of payments to interests. In countries with high fragility due to the effect of pandemic, economic uncertainty causes fluctuations in the exchange rate. Is the reason for the change in the exchange rate, the number of cases or economic risks that may occur due to possible health problems?In this study, the impact of the number of new cases and the number of new deaths for the process of Covid-19 pandemic on the exchange rate in Turkey is examined. The daily data consider the number of new cases, the number of new deaths and exchange rate for the period of 16.03.2020–06.05.2020. The first step of the analysis, the stationary of the series is tested by Lee and Strazicich (2003) unıt root test which allowed structural break. Hatemi-J (2008) Cointegration Test that allow two structural breaks and Hacker-Hatemi-J Bootstrap causality test are used in the analysis. In the results of the Hatemi- J (2008) cointegration test, there is a medium and long-term relationship, with under structural breaks between the number of new cases and the number of new deaths and the exchange rate. According to the results of the analysis, it can be concluded that the number of new cases and the number of new deaths have a significant effect on the exchange rate, causing uncertainty in the economy.JEL Classification: I19, F31, C22

The Effect of Exchange Rates on Trade Balance: An Empirical Study of Morocco

2018 ◽  
Vol 3 (1) ◽  
pp. 01-10
Author(s):  
Hicham Sadok
Keyword(s):  
Exchange Rate ◽  
Empirical Study ◽  
Exchange Rates ◽  
Foreign Trade ◽  
Real Exchange Rate ◽  
Trade Balance ◽  
Jel Classification ◽  
Strong Impact ◽  
J Curve ◽  
The Relationship

Objective - This paper aims to examine the relationship between exchange rates and trade balance in Morocco, to investigate whether the Marshall-Lerner condition and J-curve exist. Methodology/Technique - This paper attempts to identify the relationship between the real exchange rate and trade balance in Morocco between 2000 an 2015. Findings - Historically, exchange rates have had a strong impact on foreign trade in Morocco. Novelty - This study concludes that the fluctuation of exchange rates has no notable impact on the rate of foreign trade. Type of Paper: Empirical. Keywords: Exchange Rates; Trade Balance; Exports; Imports; Morocco. JEL Classification: D51, D59.

scholarly journals Impact of FDI as Macroeconomic Variable on the Exchange Rates with Special Reference to the Selected Asian Countries’ Currencies

2019 ◽  
Vol 8 (2S10) ◽  
pp. 122-125
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Exchange Rate Regime ◽  
Asian Countries ◽  
Human Race ◽  
Macroeconomic Variable ◽  
Fdi Inflows ◽  
The World ◽  
The Exchange Rate ◽  
Globalized World

Globalization has brought immense benefit for the welfare of the human race. For a globalized world, the economic integration of nations around the world is a prerequisite. This integration of economies has brought in the concept of international trade wherein the countries trade with each other. For a trade to be carried out the buyer has to pay the seller in currency that is accepted by the seller. As of now one of the widely accepted currencies is USD and the exchange rates of most of the currencies are determined in terms of USD. The exchange rate of a country is affected by many macroeconomic variables and one among them is the FDI. This paper has tried to analyse whether FDI as a macroeconomic variable affects the exchange rate of selected Asian countries' currencies. With the integration of economies around the world, it is important to know the factor responsible for the variation in the exchange rates. With this knowledge, the Governments and the Central Banks can plan their policies accordingly that are attractive to the investors. The study has considered countries such as China, India, Phillipines, Qatar and Singapore. The study has used regression to find out the influence of FDI inflows on the exchange rates of respective currencies and correlation has been used to find the extent of relationship between the variables considered. The results show that the FDI inflows affect the exchange rates of all the countries considered except Phillipines. Also correlation shows that FDI inflows and Exchange rates of Qatar are not related since Qatar follow fixed exchange rate regime.

Investigating the Relationship between Trade Balance and the Exchange Rate: The Case of Laos’ Trade with Thailand

2018 ◽  
Vol 19 (3) ◽  
pp. 590-603 ◽  
Author(s):  
Phouphet Kyophilavong ◽  
Muhammad Shahbaz ◽  
Ijaz Ur Rehman ◽  
Somchith Souksavath ◽  
Sengchanh Chanthasene
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Trade Policy ◽  
Real Exchange Rate ◽  
Trade Balance ◽  
The Real ◽  
J Curve ◽  
The Exchange Rate ◽  
The Relationship

We investigate the nexus between Laos’ trade balance and its real exchange rate with Thailand. We apply the combined cointegration approach and find that the trade balance and the real exchange rate have cointegration. The devaluation of Laos’ Kip improves the trade balance, but there is no evidence of the J-curve phenomenon. Laos’s economic growth causes its trade balance to deteriorate. A rise in Thai income increases the trade balance of Laos. This study presents new insights for policymakers who seek to sustain trade with Thailand by designing a comprehensive trade policy.

The Relationship Between Stock Prices and Exchange Rates

2017 ◽  
pp. 171-185 ◽  
Author(s):  
Oguzhan Aydemir ◽  
Banu Demirhan
Keyword(s):  
Saudi Arabia ◽  
Exchange Rate ◽  
Exchange Rates ◽  
Granger Causality ◽  
Stock Prices ◽  
Causality Analysis ◽  
Mena Countries ◽  
Local Currency ◽  
Panel Granger Causality ◽  
The Relationship

The relationship and causality between stock prices and exchange rates has preoccupied the minds of economists, investors and policy makers for a long time. However, the relationship or the direction of causality between these two variables still remains unresolved in both theory and empirics. This study examines panel Granger causality relationship between stock price and exchange rate for selected six MENA countries (Bahrain, Lebanon, Morocco, Pakistan, Qatar, and Saudi Arabia) over the period of 2005:01 and 2013:12. Panel DOLS and FMOLS methods are used to estimate long-run coefficients. On the other hand, panel based error-correction model is used to perform causality analysis. The findings of FMOLS and DOLS methods indicate that the appreciation of local currency in Bahrain, Lebanon, Morocco, Pakistan and Qatar leads to a reduction in stock prices. Contrary, in Saudi Arabia, the appreciation of local currency increases stock prices. Panel Granger causality analysis shows that there is a unidirectional causality from exchange rate to stock prices in MENA countries.

scholarly journals EFFECT OF EXCHANGE RATE AND INTEREST RATES SBI RUPIAHS TO GAIN SHARE PT. INDOFOOD SUKSES MAKMUR TBK

2019 ◽  
pp. 28-40
Keyword(s):  
Exchange Rate ◽  
Data Analysis ◽  
Interest Rate ◽  
Exchange Rates ◽  
Interest Rates ◽  
Stock Price ◽  
The World ◽  
The Exchange Rate ◽  
Model Equations ◽  
Variable Exchange

This study aimed to determine the effect of exchange rate and interest rate SBI to simultaneously benefit the company's shares, determine the effect of the exchange rate to gain partial shares of the company and determine the effect of SBI interest rate of the company's stock price partially. The study was conducted at PT. Indofood CBP Sukses Makmur Tbk. The data used for 4 years were taken monthly or as many as 48 data. The data is sourced from the website of Bank Indonesia, Foam Indonesia, and the World Investment Securities. Based on data analysis known that the variable exchange rates and interest rates SBI affect the company's stock gains simultaneously. Calculated F value of 16.943 with a significance of 0.00. The significance value of less than 0.05 is the value of alpha. R squared value of 43.0%. It means variable exchange rate and the SBI interest rate effect on profit shares of the company amounted to 43.0% while the rest influenced by other variables not included in the model equations. The exchange rate has no effect on the company's stock gains were studied. T value of 0.872 with a significance value of 0.388. The significance values greater than 0.05. R squared value of 1.6%. This value shows the effect of the exchange rate variable to stock gains of 1, 6% and the rest is influenced by other variables that are not included in the analysis tables. Variable SBI affects the profit shares of the company being investigated. T value of 4.498 with a significance value of 0.00. The significance value less than 0.05. R squared value of 30.5%. This value indicates the SBI variables influence on stock gains of 30.5% and the rest is influenced by other variables that are not included in the analysis tables.

scholarly journals Profit margins, exchange rates and structural change: empirical evidences for the period 1996-2017

2020 ◽  
Vol 40 (2) ◽  
pp. 285-309 ◽  
Author(s):  
NELSON MARCONI ◽  
GUILHERME MAGACHO ◽  
JOÃO GUILHERME R. MACHADO ◽  
RAFAEL DE AZEVEDO RAMIRES LEÃO
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Profit Rate ◽  
Medium Term ◽  
Short Term ◽  
Profit Margins ◽  
Manufacturing Sectors ◽  
The Exchange Rate ◽  
Rate Of Profit ◽  
The Relationship

ABSTRACT This research seeks to understand the relationship between the rate of profit and the exchange rate and how this relationship can impact the productive structure. We construct a theoretical model in which the exchange rate influences the rate of profit, and we argue that although an overvalued exchange rate could benefit sectors with high imported input coefficients in the short term because it reduces costs, it negatively impacts the demand for their products and also reduces the aggregatedemand; hence, an overvalued exchange rate could shrink the profit rate of these sectors in the medium term. In the Brazilian case, these sectors are the high technological-content manufacturing sectors.

scholarly journals Real Exchange Rate Effects on Trade and Immiserizing Growth: The Case of Turkey 2003-2013

2014 ◽  
Author(s):  
Yağmur Sağlam ◽  
Hüseyin Avni Egeli
Keyword(s):  
Growth Rate ◽  
Exchange Rate ◽  
Exchange Rates ◽  
Real Exchange Rate ◽  
Real Exchange Rates ◽  
Structural Break ◽  
Terms Of Trade ◽  
Standard Theory ◽  
Vector Autoregressive ◽  
The Relationship

The aim of this study is to examine the long run relationship between real exchange rates and trade within terms of immiserizing growth for Turkey. The relationship between real exchange rates and trade are taking into consideration with two approach which are pass-through and standard theory. So it is observed that which approach is valid for Turkey. Also we tried to see if trade policies which on terms of trade create immiserizing growth or not during the period. We used unrestricted Vector Autoregressive Model (VAR) analysis to see the relationship between real exchange rate and trade rate, growth. Also we added a dummy into the VAR which demonstrate the structural break for global economic crisis as an exogenous variable. The results of the application are; in the long term there is no cointegration between trade rate and real exchange rates and growth. So for the short term; the dummy was statistically significant and affects the distribution of series; the relationship between trade rate and real exchange rates are very weak and rarely supports the Standard Theory. Also terms of trade impacts growth rate positively but the effects of growth rate on terms of trade is indeterminate. So there is not an immiserizing growth in Turkey for the period between 2003 and 2013.

scholarly journals The dynamic response of the rand real exchange rate to fundamental shocks

2016 ◽  
Vol 43 (1) ◽  
pp. 108-121 ◽  
Author(s):  
Mehmet Balcilar ◽  
Rangan Gupta ◽  
Charl Jooste
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Real Exchange Rate ◽  
South African ◽  
Impulse Responses ◽  
The South ◽  
Content Type ◽  
The Exchange Rate ◽  
The Relationship ◽  
Over Time

Purpose – The authors analyse the relationship between the South African real exchange rate and economic fundamentals – demand, supply and nominal shocks. The paper aims to discuss these issues. Design/methodology/approach – The authors use a time-varying parameter VAR to study the coherence, conditional volatility and impulse responses of the exchange rate over specific periods and policy regimes. The model is identified using sign-restrictions that allow for some neutrality of impulse responses over contemporaneous and long horizons. Findings – The results suggest that the importance of fundamental shocks on the exchange rate is time dependent. Hence there is a loss in information when using standard linear models that average out effects over time. The response of the exchange rate to demand and supply shocks have weakened over the 1994-2010 period. Research limitations/implications – The period following financial crisis has strengthened the relationship between supply and demand shocks to the exchange rate, but has weakened the relationship between interest rate shocks and the exchange rate response. Practical implications – This paper provides deeper insight as to how the exchange rate responds to fundamental shocks. This should help monetary policy understand the consequences of interest rate decisions on the exchange rate and the indirect effect of inflation on the exchange rate. Originality/value – This application is new to the South African literature. The authors propose that the use of interest rates is limited in affecting the value of the rand exchange rate over particular periods. Isolating fundamental shocks to exchange rates over time helps policy makers make clearer and more informed decisions.

scholarly journals The effect of real exchange rates and their volatilities on the selected agricultural commodity exports: A case study on Turkey, 1971–2010

2013 ◽  
Vol 59 (No. 5) ◽  
pp. 235-246 ◽  
Author(s):  
H. Yanikkaya ◽  
H. Kaya ◽  
O.M. Kocturk
Keyword(s):  
Exchange Rate ◽  
Exchange Rates ◽  
Real Exchange Rate ◽  
Cross Sections ◽  
Real Exchange Rates ◽  
Exchange Rate Volatility ◽  
Agricultural Commodity ◽  
Data Set ◽  
The Real ◽  
The Exchange Rate

This study investigates the effect of the exchange rate volatility and the real exchange rate on the bilateral agricultural exports flows of Turkey to 46 countries. A panel data set, which contains 46 cross-sections and 1840 observations, is used for exports of the selected agricultural commodities to countries from 1971 to 2010. Our empirical results based on a gravity equation show that while the exchange rate volatility does not exert a significant effect on the Turkish agricultural commodity exports, the real exchange rate has a statistically significant effect on the agricultural commodity export flows. Regardless of the region chosen, raisins and tobacco exports are very much sensitive to the real exchange rates. It means that any depreciation in the Turkish Lira leads to higher exports for these commodities. We have also some interesting results on other commodities. Exports of dried figs show no sensitivity to the exchange rate or its volatilities, except for the EU countries. For the full sample, exports of citrus, grape and hazelnuts increases as the TL depreciates. The sensitivity of hazelnut to the real exchange rates varies among regions.  

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