IDEAS home Printed from https://ideas.repec.org/p/red/sed018/658.html
   My bibliography  Save this paper

Exchange Rates and Prices: Evidence from the 2015 Swiss Franc Appreciation

Author

Listed:
  • Ariel Burstein

    (UCLA)

Abstract

The removal of the lower bound on the CHF/EUR nominal exchange rate in January 2015 provides a unique setting to study the implications of a large and sudden appreciation of the nominal exchange rate in an otherwise stable macroeconomic environment. Using retail prices from a homescan data of individual consumer goods and the microdata underlying the import price index, we measure the response of border and consumer prices to the CHF appreciation, and how household expenditures responded to these price changes. Cross-section variation in border price changes induced by differences in the currency of invoicing at the border have a significant impact on consumer prices and expenditures of imported goods at the consumer level, and also on consumer prices of domestically produced goods that compete with these imported good. While the frequency of import price reductions rises in the aftermath of the appreciation, the average size of these price reductions falls (which is consistent with a s-S pricing model with fat-tailed distributed shocks), contributing to low aggregate import-price pass-through.

Suggested Citation

  • Ariel Burstein, 2018. "Exchange Rates and Prices: Evidence from the 2015 Swiss Franc Appreciation," 2018 Meeting Papers 658, Society for Economic Dynamics.
  • Handle: RePEc:red:sed018:658
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Breinlich, Holger & Leromain, Elsa & Novy, Dennis & Sampson, Thomas, 2019. "Exchange Rates and Consumer Prices : Evidence from Brexit," The Warwick Economics Research Paper Series (TWERPS) 1234, University of Warwick, Department of Economics.
    2. Costa, Rui & Dhingra, Swati & Machin, Stephen, 2019. "Trade and Worker Deskilling," CEPR Discussion Papers 13768, C.E.P.R. Discussion Papers.
    3. Xavier Jaravel & Erick Sager, 2019. "What are the Price Effects of Trade? Evidence from the U.S. and Implications for Quantitative Trade Models," Finance and Economics Discussion Series 2019-068, Board of Governors of the Federal Reserve System (U.S.).
    4. Chen, Natalie & Chung, Wanyu & Novy, Dennis, 2018. "Vehicle Currency Pricing and Exchange Rate Pass-Through," CEPR Discussion Papers 13085, C.E.P.R. Discussion Papers.
    5. repec:cpr:ceprdp:14176 is not listed on IDEAS
    6. Fischer, Andreas M & Yesin, Pinar, 2019. "Foreign currency loan conversions and currency mismatches," CEPR Discussion Papers 13923, C.E.P.R. Discussion Papers.
    7. Fernandes, Ana & Winters, L. Alan, 2018. "The effect of exchange rate shocks on firm-level exports: evidence from the Brexit vote," CEPR Discussion Papers 13253, C.E.P.R. Discussion Papers.
    8. Xavier Jaravel & Erick Sager, 2019. "What are the Price Effects of Trade? Evidence from the US and Implications for Quantitative Trade Models," CEP Discussion Papers dp1642, Centre for Economic Performance, LSE.
    9. Breinlich, Holger & Leromain, Elsa & Novy, Dennis & Sampson, Thomas, 2019. "Exchange Rates and Consumer Prices : Evidence from Brexit," The Warwick Economics Research Paper Series (TWERPS) 1234, University of Warwick, Department of Economics.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:red:sed018:658. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christian Zimmermann). General contact details of provider: http://edirc.repec.org/data/sedddea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.