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- Title
Exchange Rate Pass-Through for Selected Southeast Asian Countries.
- Authors
Chan, Stephanie L.
- Abstract
Long- and short-run exchange rate pass-through coefficients were estimated for Malaysia, Indonesia, Thailand, and the Philippines using a simple model based on absolute purchasing power parity. Results were lower than 0.30 for all four countries. Cointegration tests confirmed the existence of a long-run relationship between CPI, GDP, exchange rate, and the U.S. PPI for the countries studied. However, the post-estimation tests showed that a more comprehensive model may need to be developed. The low coefficients reflect the success of the countries in stabilizing their inflation levels, though implying that exchange rate interventions may be less effective in restoring trade balance.
- Subjects
FOREIGN exchange rates; MONETARY policy; PURCHASING power parity; GROSS national product; TIME series analysis; GROSS domestic product; BALANCE of trade; FINANCIAL risk management; FINANCIAL performance
- Publication
DLSU Business & Economics Review, 2009, Vol 18, Issue 2, p115
- ISSN
0116-7111
- Publication type
Article
- DOI
10.3860/ber.v18i2.796