Abstract
The prevailing pegged exchange rate system has been blamed for the recent higher inflation in the GCC countries. However, empirical evidence for period 1975–2011 shows that the short-run and long-run exchange rate pass-through elasticities to the consumer price levels of the GCC countries, in contrast to the popular belief, are either close to zero or statistically insignificant. The trading partners' (foreign) inflation is the main determinant of the consumer price inflation in these countries. Domestic factors play only a small part in the long-run determination of inflation of the GCC countries.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
