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Exchange Rate Developments and Fundamentals in Four EU Accession and Candidate Countries: Bulgaria, Croatia, Romania and Turkey

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Author Info

  • Jesus Crespo Cuaresma

    ()
    (Oesterreichische Nationalbank)

  • Jarko Fidrmuc

    ()
    (Oesterreichische Nationalbank, Foreign Research Division)

  • Maria Antoinette Silgoner

    ()
    (Oesterreichische Nationalbank)

Abstract

This paper deals with exchange rate challenges in the four potential EU Member States Bulgaria, Croatia, Romania and Turkey. For the two countries with freely floating currencies, Romania and Turkey, we evaluate possible exchange rate misalignments based on a monetary model of exchange rate determination. In the case of Bulgaria and Croatia, two countries with currency board and narrow-band peg arrangements against the euro, we discuss possible exit strategies. We argue that a continuation of their current exchange rate regimes is likely to represent an optimal strategy for these countries in the run-up to both EU membership and the eventual adoption of the euro.

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Bibliographic Info

Article provided by Oesterreichische Nationalbank (Austrian Central Bank) in its journal Focus on European Economic Integration.

Volume (Year): (2004)
Issue (Month): 2 ()
Pages: 119-137

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Handle: RePEc:onb:oenbfi:y:2004:i:2:b:5

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Cited by:
  1. Égert, Balázs, 2005. "Equilibrium exchange rates in Southeastern Europe, Russia, Ukraine and Turkey: Healthy or (Dutch) diseased?," BOFIT Discussion Papers 3/2005, Bank of Finland, Institute for Economies in Transition.
  2. Dumitru, Ionut, 2006. "Estimarea cursului de schimb real de echilibru in România
    [The equilibrium exchange rate in Romania]
    ," MPRA Paper 10631, University Library of Munich, Germany.
  3. Jesus Crespo Cuaresma & Jarko Fidrmuc & Maria Antoinette Silgoner, 2004. "Exchange Rate Developments and Fundamentals in Four EU Accession and Candidate Countries: Bulgaria, Croatia, Romania and Turkey," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue 2, pages 119-137.

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