Deviations of Exchange Rates from Purchasing Power Parity
Author | : Mr.Tamim Bayoumi |
Publisher | : International Monetary Fund |
Total Pages | : 18 |
Release | : 1998-05-01 |
ISBN-10 | : 9781451960846 |
ISBN-13 | : 1451960840 |
Rating | : 4/5 (840 Downloads) |
Download or read book Deviations of Exchange Rates from Purchasing Power Parity written by Mr.Tamim Bayoumi and published by International Monetary Fund. This book was released on 1998-05-01 with total page 18 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine the mean-reverting properties of real exchange rates, by comparing the unit root properties of a group of international real exchange rates with two groups of intra-national real exchange rates. Strikingly, we find that while the international real rates taken as a group appear mean-reverting, the intra-national rates are not. This is consistent with the view that while monetary shocks may be mean-reverting over the medium term, underlying real factors do generate long-term trends in real exchange rates.