How misaligned is the Australian real exchange rate?
AbstractThis paper uses quarterly data from September 1981 to December 2000 to quantify the extent to which the Australian real exchange rate is misaligned relative to its long-run equilibrium value. Our modelling suggest, that as of December 2000, the real exchange rate was seven percent below its equilibrium value; this figure is modest in comparison to purchasing power parity indicators that suggest considerably greater misalignment. Furthermore, once short-run dynamics are accounted for, even this anomaly disappears.
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Bibliographic InfoPaper provided by International and Development Economics in its series International and Development Economics Working Papers with number idec01-2.
Length: 30 pages
Date of creation: 2001
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Find related papers by JEL classification:
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
- Z00 - Other Special Topics - - General - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-12-12 (All new papers)
- NEP-IFN-2004-12-12 (International Finance)
- NEP-MAC-2004-12-12 (Macroeconomics)
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