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The Equilibrium Exchange Rate of Mauritius: Evidence from Two Structural Models

Listed author(s):
  • Patrick Imam
  • Camelia Minoiu

In this paper we assess the equilibrium value of the Mauritian rupee in 2006-7 and over the medium run using two structural models. First, we derive a current account-based measure of the exchange rate equilibrium using the macroeconomic balance approach. Second, we estimate a reduced-form fundamental equilibrium exchange rate measure. Our results, which are robust to an alternative non-econometric approach, suggest that the Mauritian rupee was aligned with its equilibrium value in 2006-7 and little adjustment appeared necessary over the medium run.

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Article provided by M.E. Sharpe, Inc. in its journal Emerging Markets Finance and Trade.

Volume (Year): 47 (2011)
Issue (Month): 6 (November)
Pages: 134-147

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Handle: RePEc:mes:emfitr:v:47:y:2011:i:6:p:134-147
Contact details of provider: Web page: http://mesharpe.metapress.com/link.asp?target=journal&id=111024

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