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Does the Exchange Rate Really Affect Consumer Spending?


  • John J Heim


This paper examines the extent to which changes in imports or exports of US consumer goods and services occurs in response to a change in the exchange rate, 1960-2000. The data used are taken from the Economic Report of the President, 2002. The findings indicate that an increase in the trade weighted exchange rate of about 1% is associated with an increase in import of consumer goods of approximately $1 bn the year after the change. The same level increase seems associated with a decline in consumer goods export of about $0.75 bn.

Suggested Citation

  • John J Heim, 2008. "Does the Exchange Rate Really Affect Consumer Spending?," The IUP Journal of Monetary Economics, IUP Publications, vol. 0(2), pages 31-42, May.
  • Handle: RePEc:icf:icfjmo:v:06:y:2008:i:2:p:31-42

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    References listed on IDEAS

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    JEL classification:

    • F00 - International Economics - - General - - - General
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies


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