Estimating the Exchange Rate Pass-Through to Prices in Mexico
AbstractThis paper estimates the magnitude of the exchange rate pass-through to consumer prices in Mexico. Moreover, it analyzes if the pass-through dynamics have changed in recent years. In particular, it uses a methodology that generates results consistent with the hierarchy implicit in the cpi. The results suggest that the exchange rate pass-through to the general price level is low and not statistically significant. However, the pass-through is positive and significant for goods prices. Furthermore, the exchange rate pass-through declined over the 2000s and the depreciation observed in 2011 did not change this trajectory.
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Bibliographic InfoArticle provided by Centro de Estudios Monetarios Latinoamericanos in its journal Monetaria.
Volume (Year): I (2013)
Issue (Month): 2 (July-December)
Find related papers by JEL classification:
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- F31 - International Economics - - International Finance - - - Foreign Exchange
- F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
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- Frain, John C., 2004. "A RATS subroutine to implement the Chow-Lin distribution/interpolation procedure," Research Technical Papers 2/RT/04, Central Bank of Ireland.
- Reinout De Bock & Alexander Demyanets, 2012. "Bank Asset Quality in Emerging Markets: Determinants and Spillovers," IMF Working Papers 12/71, International Monetary Fund.
- Raphael A. Espinoza & Ananthakrishnan Prasad, 2010. "Nonperforming Loans in the GCC Banking System and their Macroeconomic Effects," IMF Working Papers 10/224, International Monetary Fund.
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