scholarly journals Determining the Household Consumption Expenditure’s Resilience towards Petrol Price, Disposable Income and Exchange Rate Volatilities

Economies ◽  
2021 ◽  
Vol 9 (2) ◽  
pp. 87
Author(s):  
Thomas Habanabakize
Keyword(s):  
Exchange Rate ◽  
South African ◽  
Time Series Data ◽  
Exchange Rate Volatility ◽  
Household Consumption ◽  
Disposable Income ◽  
Series Data ◽  
Consumption Expenditure ◽  
Petrol Price ◽  
Standards Of Living

One of the core objectives of economic development is to improve people’s standards of living. However, both standards of living and consumption expenditures are often determined by disposable income, crude oil prices and exchange rate volatility. The current paper employed quarterly time series data from 2002 to 2020 to analyse the responsiveness of household consumption expenditure to the petrol price, disposable income and exchange rate volatility in South African. The empirical outcome suggested that a long-run relationship exists between variables under consideration. Additionally, the current level of consumption expenditure was found to be determined by income level and exchange rate volatility whilst changes in petrol price had no significant effect on short-term consumption expenditure. Based on these findings, the study suggests that the South African policymakers and government authorities implement policies and strategies that enhance both household income and exchange rate. Those strategies may include strengthening the country’s currency, production improvement, inflation rate reduction, and the creation of job opportunities.

scholarly journals THE IMPACT OF EXCHANGE RATE VOLATILITY ON ECONOMIC GROWTH IN NIGERIA: A DYNAMIC ECONOMETRIC APPROACH

2021 ◽  
pp. 16-40
Author(s):  
Comfort Akinwolere Bukola ◽  
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Time Series Data ◽  
Negative Impact ◽  
Positive Impact ◽  
Exchange Rate Volatility ◽  
Series Data ◽  
Balance Of Trade ◽  
Econometric Approach ◽  
The Impact

This study examined the impact of exchange rate volatility on economic growth in Nigeria. The study covers the period of 1986 to 2019. Using time series data, the methodology adopted is the Vector Error Correction Mechanism to explore the impact of exchange rate volatility on the selected macroeconomic variables. The result indicated that exchange rate volatility has a significant impact on economic growth, specifically it has a positive impact on inflation, unemployment and balance of trade. On the other hand it has a negative impact on economic growth and investment. The recommendations made include; that relevant authorities should try to avoid systematic currency devaluations in order to maintain exchange rate volatility at a rate that allows adjustment of the balance of payments.

Effects of exchange rate volatility on export volume and prices of forest products

2010 ◽  
Vol 40 (11) ◽  
pp. 2069-2081 ◽  
Author(s):  
Sijia Zhang ◽  
Joseph Buongiorno
Keyword(s):  
Exchange Rate ◽  
Time Series Data ◽  
Export Price ◽  
Policy Issue ◽  
Exchange Rate Volatility ◽  
Forest Products ◽  
Series Data ◽  
Short Run ◽  
Exchange Rate Level ◽  
Over Time

The relative value of currencies varies considerably over time. These fluctuations bring uncertainty to international traders. As a result, the volatility in exchange rate movements may influence the volume and the price of traded commodities. The volatility of exchange rates was measured by the variance of residuals in a GARCH(1,1) model of the exchange rate. We estimated the effect of this exchange rate volatility on export quantity and price with autoregressive distributed lag models based on monthly data of US exports and prices to 14 countries for eight commodity groups. The most general and statistically significant results were obtained by pooling the time series data across destination countries and products. They suggested that an increase in exchange rate variability of 1% led to a short-run decrease in export quantity of 0.3%–0.4% and to a short-run decrease in export price of 0.1%. Both the quantity and the price effect faded away over time. The effects were less systematic and statistically significant for specific export destinations or individual products. Thus, in contrast with exchange rate level, exchange rate volatility may not be a major policy issue for US forest product exports.

scholarly journals Remittance Inflows and Poverty Dynamics in South Africa: An Empirical Investigation

SAGE Open ◽  
2020 ◽  
Vol 10 (4) ◽  
pp. 215824402098331
Author(s):  
Mercy. T. Musakwa ◽  
N. M. Odhiambo
Keyword(s):  
South Africa ◽  
Mortality Rate ◽  
Infant Mortality ◽  
Time Series Data ◽  
Negative Impact ◽  
Household Consumption ◽  
Infant Mortality Rate ◽  
Series Data ◽  
Consumption Expenditure ◽  
The Impact

In this study, we investigate the impact of remittance inflows on poverty reduction in South Africa, using time series data from 1980 to 2017. The main objective of this study is to establish whether South Africa can harness remittance inflows to alleviate poverty. Two poverty proxies, namely household consumption expenditure and infant mortality rate, are used in this study. To ensure robustness of the results, both income and non-income proxies of poverty are employed. Using the autoregressive distributed lag (ARDL) bounds approach, the study found that remittance has a negative impact on poverty in the short run and in the long run when household consumption expenditure is used as a proxy for poverty. However, when the infant mortality rate is used as a proxy, remittance is found to have no impact on poverty. It can be concluded that the impact of remittance on poverty is sensitive to the proxy used. The study concludes that South Africa could benefit immensely from some forms of remittances in its quest to poverty alleviation.

scholarly journals Analysing the Exchange Rate Volatility Relative to Trade Balance: The Case of SACU Countries

2020 ◽  
pp. 60-74
Author(s):  
Christine M. Haansende ◽  
Jacob M. Nyambe
Keyword(s):  
Exchange Rate ◽  
Trade Balance ◽  
Foreign Exchange Market ◽  
Time Series Data ◽  
Negative Impact ◽  
Exchange Rate Volatility ◽  
Series Data ◽  
Impulse Response Functions ◽  
Short Run ◽  
The Exchange Rate

The term exchange rate volatility is widely used in the financial market. The exchange rate is determined in the foreign exchange market, which is said to be the largest market in the world and it trades in financial assets. The main focus of this study is to analyse the nature of the relationship between exchange rate and trade balance in the selected member states of the SACU region in which the selected countries are Botswana, Namibia, Swaziland and South Africa. This study uses time series data from the period of 1986 to 2016. The Generalized Autoregressive Conditional Heteroscedasticity (GARCH) model, the impulse response functions and variance decompositions are used in the analysis. Results show that there is a short-run relationship between exchange rate volatility and trade balance. It was found that there is a positive and negative impact between these two variables, with high volatility. Furthermore, this study recommends all Central Banks in the SACU region to intervene in order to mitigate exchange rate volatility.

Impact of Exchange Rate Volatility on the Export Performance of Developing Country: Evidence from Bilateral Trade between Bangladesh and the US

2015 ◽  
Vol 16 (2) ◽  
pp. 20-39
Author(s):  
Jahid Hasan ◽  
Dewan Muktadir-Al-Mukit ◽  
Farjana Islam
Keyword(s):  
Exchange Rate ◽  
Time Series Data ◽  
Export Performance ◽  
Exchange Rate Volatility ◽  
Series Data ◽  
Correction Coefficient ◽  
Long Run ◽  
Wide Range ◽  
The Us ◽  
Export Volume

The paper investigates the effects of exchange rate volatility on export volume from Bangladesh to the US market by using monthly time series data over the period of 1991 to 2012. A wide range of econometric techniques have been employed to analyze the relationship between the study variables. The study reveals a stable and significant long run relationship between the variables. By employing Cointegration technique, it is observed that in the long run, a 1% increase in exchange rate that is depreciation of Taka against US dollar causes 2.32% increase in export volume. The estimated error correction coefficient indicates that 36%deviation of export data is corrected in the short run. Impulse response function of the study also affirms the positive relationship between the variables. Finally, Granger causality analysis suggests the existence of a unidirectional causality running from exchange rate to export.

scholarly journals A Vector Autoregression Analysis of the Efficacy of External Reserves Management on Exchange Rate Stability: Evidence from Nigeria

2019 ◽  
pp. 1-11
Author(s):  
Ikechukwu Kelikume ◽  
Stanley Emife Nwani
Keyword(s):  
Exchange Rate ◽  
Empirical Result ◽  
Time Series Data ◽  
Exchange Rate Volatility ◽  
International Reserves ◽  
Series Data ◽  
Vector Error Correction ◽  
Dynamic Relationship ◽  
Vector Error ◽  
Monetary Authorities

This paper investigates the dynamic relationship between exchange rate variations and international reserves in Nigeria. The study aimed at ascertaining whether a lead-lag relationship exists between both phenomena using monthly time series data on the bureau de change exchange rate and international reserves extracted from the statistical bulletin of the Central Bank covering 108 observations between January 2010 and December 2018. The econometric techniques utilized included the Granger causality based on the vector error correction mechanism and the AR inverse root test for stability and reliability. The empirical result indicates the absence of causality between exchange rate volatility and international reserves fluctuations for Nigeria. Based on our empirical result, the study vehemently concluded that monetary authorities do not have to depend on external reserves management as an efficient strategy to stabilizing the value of the Nigerian currency. Thus, external reserves accumulation could be a face lifting parameter for credit ratings and attraction of needed capital to stimulate the much desired economic growth in Nigeria.

scholarly journals Exchange Rate, Exchange Rate Volatility and Stock Prices: An Analysis of the Symmetric and Asymmetric Effect Using ARDL and NARDL Models

2021 ◽  
Vol 15 (4) ◽  
pp. 179-190
Author(s):  
La Ode Saidi ◽  
Abd Azis Muthalib ◽  
Pasrun Adam ◽  
Wali Aya Rumbia ◽  
La Ode Arsad Sani
Keyword(s):  
Exchange Rate ◽  
Stock Prices ◽  
Stock Price ◽  
Time Series Data ◽  
Exchange Rate Volatility ◽  
Series Data ◽  
Asymmetric Effect ◽  
Short Term ◽  
Symmetry Effect

This article examined the symmetric and asymmetric effects of the IDR/USD exchange rate and its volatility on stock prices using the monthly time series data of the IDR/USD exchange rate and the Indonesian composite stock price index from January 2006 to July 2019. The data were analyzed using ARDL and NARDL models. The results showed that in the short term, the IDR/USD exchange rate has a symmetry effect on stock prices, while volatility lacks such a symmetric influence. However, these two variables asymmetrically affect stock prices, Furthermore, in the long term both the exchange rate and the volatility lack symmetric and asymmetric influence on stock prices.

scholarly journals The Impact of Rand/Pula Exchange Rate Volatility on Botswana’s Economic Growth

2020 ◽  
Vol 3 (2) ◽  
pp. p27
Author(s):  
SEBEGO, J. ◽  
TSHEKO, B. O. ◽  
MOTLALENG, G. R.
Keyword(s):  
Economic Growth ◽  
Exchange Rate ◽  
Time Series Data ◽  
Labour Force ◽  
Trade Openness ◽  
Exchange Rate Volatility ◽  
Series Data ◽  
Method Of Moment ◽  
Generalized Method Of Moment ◽  
The Impact

This paper undertakes an investigation of the impact of the Rand/Pula exchange rate volatility on Botswana’s economic growth. The paper is using annual time series data, from 1977 to 2018. The Generalized Method of Moment (GMM) is employed to evaluate the impact of the real exchange rate volatility on Botswana’s economic growth. The GARCH model results found the Pula/Rand exchange rate to be volatile. The Rand/Pula exchange rate volatility does not have an impact on Botswana’s economic growth. This finding mirrors those of Kaur et al. (2019) and Musyoki et al. (2012). They found negative but insignificant impact of exchange rate volatility on economic growth in Malaysia and Kenya, respectively. Our empirical findings suggest that Botswana’s economic growth is largely explained by trade openness and growth of labour force and not influenced by the Rand/Pula exchange rate volatility.

scholarly journals Analysis of the Influence of Interest Rate, Rupiah Exchange Value, Household Consumption, and Import on Inflation in Indonesia Period 2010.Q1 - 2018.Q4

2020 ◽  
pp. 81-91
Author(s):  
Jusmer Sihotang ◽  
Nancy Nopeline
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Time Series Data ◽  
Household Consumption ◽  
Series Data ◽  
Multiple Regression Equation ◽  
Exchange Value ◽  
The Government ◽  
The Interest Rate

This study aims to analyze the effect of the interest rest, the exchange rate of the rupiah, and imports on the inflation in Indonesia. The study used multiple regression equation by using secondary time series. Data from 2008.Q1-2018.Q4. The results showed that the interest rate of SBI, exchange rate of rupiah against US Dollar, private sector household consumption, and the total imports of Indonesia had a simultaneous impact on the inflation in Indonesia. However, partially only the interest rate of SBI and total imports of Indonesia had a significant impact on the inflation in Indonesia, respectivelyon the level ofα = 1% and α= 5%. These results mean that the increasing of interest rate of SBI and Indonesian import could impact the inflation rate in Indonesia. Based on the findings, the policy to control the inflation in Indonesia was Bank Indonesia as the holder of monetary policy needs to oversee the determination of business credit interest rate (micro, retail, and corporate), by commercial banks in order to maintain the rate on the stable and low levels. In addition, the government needs to compose the policy to reduce the dependence on imported goods by providing various facilities and incentives to increase the interest of entrepreneurs to invest in industries that produce imported substitute goods.

scholarly journals Effect of exchange rate volatility on Rwandan coffee price and export volumes

Agro-Science ◽  
2021 ◽  
Vol 21 (1) ◽  
pp. 1-6
Author(s):  
A. Kabayiza ◽  
R. Muhire ◽  
S. Nsabimana ◽  
M. Kabarungi ◽  
Y.B. Ningabire ◽  
...  
Keyword(s):  
Exchange Rate ◽  
Time Series Data ◽  
Export Price ◽  
Exchange Rate Volatility ◽  
Real Income ◽  
Series Data ◽  
Long Run ◽  
Short Run ◽  
The Exchange Rate ◽  
Coffee Price

The main strategy of Rwanda for having a steady growth in coffee export value and revenues was increased sales of speciality coffee. However, global coffee prices are often volatile and Rwanda has little control over the fluctuating global prices. This paper analysed the effect of exchange rate volatility on the price and exports of Rwanda coffee. In order to respond to this question, the monthly time series data on bilateral Rwanda coffee exports and real effective exchange rates from January 2001 to December 2016 were analysed. The cointegration methods and error correction model using the autoregressive distributed lag procedure andGlosten, Jagannathan, and Runkle-Generalized Autoregressive Conditional Heteroskedasticity (GJR-GARCH) model were used to analyse the data. The findings showed that the exchange rate volatility resulted in an increase in Rwandan coffee export price in the long run by 1.5% and a decrease in the short run by 0.2%. The findings also showed that the exchange rate volatility affected coffee export volumes in the long run and the short run by 44.4% and 3.8%, respectively. The real income in importing countries increased coffee prices in the long run by 3.0% and coffee export volumes in the long run and the short run by 26.9% and 38.5%, respectively. A review of monetary policy to address the issue of volatility and hedging system adoption in the Rwanda coffee sector should be done in order to stabilize the exchange rate and to consequently avoid its bad effects on coffee price and export volumes.

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