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Exchange rate pass-through in Korea and Thailand: Trends and determinants

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  • Ghosh, Amit
  • Rajan, Ramkishen S.

Abstract

An important but age-old transmission channel of global factors into domestic prices is via exchange rate movements. This paper examines the extent and evolution of exchange rate pass-through (ERPT) into Korea's and Thailand's consumer and import prices at the aggregate level for the period over the last two decades. We find that ERPT appears to be consistently higher for Thailand compared to Korea; while for both nations ERPT of their respective bilateral rates with respect to the US dollar is higher than with respect to the Japanese yen. The paper also investigates if and how ERPT has changed over time, especially during and after the currency crisis period of 1997-1998, as well as its macroeconomic determinants.

Suggested Citation

  • Ghosh, Amit & Rajan, Ramkishen S., 2009. "Exchange rate pass-through in Korea and Thailand: Trends and determinants," Japan and the World Economy, Elsevier, vol. 21(1), pages 55-70, January.
  • Handle: RePEc:eee:japwor:v:21:y:2009:i:1:p:55-70
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    References listed on IDEAS

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    Cited by:

    1. Sri Isnowati & Mulyo Budi Setiawan, 2017. "Exchange Rate Pass-through to Import Prices in Indonesia: Evidence Post Free Floating Exchange Rate," International Journal of Economics and Financial Issues, Econjournals, vol. 7(1), pages 323-328.
    2. Murshed, Hasan & Nakibullah, Ashraf, 2015. "Price level and inflation in the GCC countries," International Review of Economics & Finance, Elsevier, vol. 39(C), pages 239-252.
    3. Prasertnukul, Weera & Kim, Donghun & Kakinaka, Makoto, 2010. "Exchange rates, price levels, and inflation targeting: Evidence from Asian countries," Japan and the World Economy, Elsevier, vol. 22(3), pages 173-182, August.
    4. Aleem, Abdul & Lahiani, Amine, 2014. "Monetary policy credibility and exchange rate pass-through: Some evidence from emerging countries," Economic Modelling, Elsevier, vol. 43(C), pages 21-29.
    5. Berner, Eike, 2011. "Exchange rate pass-through: New evidence from German micro data," Economics Working Papers 2011-01, Christian-Albrechts-University of Kiel, Department of Economics.
    6. Alain Kabundi & Asi Mbelu, 2016. "Working Paper– WP/16/10- Has the Exchange Rate Pass-Through changed in South Africa?," Papers 7556, South African Reserve Bank.
    7. repec:eee:reveco:v:51:y:2017:i:c:p:245-257 is not listed on IDEAS
    8. Ozkan, Ibrahim & Erden, Lutfi, 2015. "Time-varying nature and macroeconomic determinants of exchange rate pass-through," International Review of Economics & Finance, Elsevier, vol. 38(C), pages 56-66.

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