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The Role of Exchange Rate Movements for Prices in the Euro Area

Author

Listed:
  • Paul Gaggl

    (University of California at Davis, Department of Economics)

Abstract

This study provides new evidence on the degree of exchange rate pass-through (ERPT) within the euro area after the launch of the euro up to the end of 2007. ERPT to import, producer, and consumer prices is estimated within a simple vector auto regression (VAR) framework. ERPT in the euro area is found to be broadly consistent with earlier studies in that it exhibits the following properties: ERPT (a) is incomplete; (b) decreases along the distribution chain; (c) might have slightly decreased; and (d) varies significantly across individual EMU member countries.

Suggested Citation

  • Paul Gaggl, 2009. "The Role of Exchange Rate Movements for Prices in the Euro Area," Monetary Policy & the Economy, Oesterreichische Nationalbank (Austrian Central Bank), issue 2, pages 83-103.
    • Handle: RePEc:onb:oenbmp:y:2009:i:2:b:4
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    Cited by:

    1. Ortega, Eva & Osbat, Chiara, 2020. "Exchange rate pass-through in the euro area and EU countries," Occasional Paper Series 241, European Central Bank.

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    More about this item

    Keywords

    foreign exchange; open economy macroeconomics;

    JEL classification:

    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General

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