The diminishing impact of exchange rates on China’s exports

The Impact of Exchange Rate Movements on Trade Balance between Vietnam and Japan: J Curve Effect Test

The ‘U.S.-China trade conflict’, caused by the confrontation between criticism of China’s ‘unfair trade, intellectual property rights infringement’ against Trump’s ‘America Firsterism’ and China’s ‘The Manufacturing of China 2025’ focused on revitalizing its manufacturing, caused Korean economy to contract with its indirect trade conflict. At the same time, the ‘South Korea-Japan trade conflict’, caused by Japan’s ‘Future Investment Strategy 2018’ focused on the improvement of national income and international competitiveness through the expansion of Japanese IT industry and the claim for compensation against the Japanese company ‘Shinil Steel Co’ from victims drafted into the military by force during the Japanese colonial era leaded to economic retaliation of Japan. This direct trade conflict provided challenge to the economy of South Korea. The multilateral conflict has revealed its effect in many ways. Therefore, it would be very meaningful to analyze one of the effects of ‘indirect and direct conflicts’ by analyzing changes in the KOSPI, a barometer representing South Korean economy. The study uses data from March 31, 2017 to October 24, 2019, in order to confirm the effect of the conflict by analyzing the relationship between the KOSPI and Stock Price Index of each country, exchange rate, international oil prices under the U.S-China & South Korea-Japan trade conflicts. The study also adopted a VAR model to overcome the rigidity of time. All parallax variables in the model were set as independent variables, and the actual economy was analyzed through time series information observed through the model. This could provide basic data for deriving our matching task and examine the ripple path of conflict by analyzing variables. Based on the VAR model, the study measured the effect of each conflict on the economy of South Korea by analyzing the relationship of variables through the Grandeur causal relationship and impulse response. The results are as follows. In indirect conflicts the KOSPI shows only a temporary response to the impact of the S&P500/SSEC, but the impact of international oil prices and exchange rates has the effect of the KOSPI falling. And the impact of exchange rates last for a long time. On the other hand, in direct conflicts, the KOSPI was increased by the impact of the NIKKEI and its effect lasted for a long time. Also the impact of international oil prices and foreign exchange rates, same for indirect conflict, has the effect of falling KOSPI, and the impact of exchange rates lasts for a long time. The results indicate that the Korean stock market showed more sensitive reaction to the direct trade conflict with Japan. The implications of the study are as follows. The effect of the conflict is conveyed through the movement of exchange rates, so the government have to prepare for the damage of the conflict by managing possession of foreign exchange. Also, in the process of reaching an agreement between South Korea and Japan, South Korean companies were able to reduce the dependence on Japanese raw materials. However, the study is focused on the overall volume of South Korea, so there is a limitation that the conflict is not able to consider the changes of local unit affeted by the conflict.

In this article, we examine the impact of the real effective exchange rate for several countries in the Euro area over the period before and after the introduction of the euro. Based on ARDL modeling techniques, we estimate the long-run and short-run relationships between exports volumes and a number of key variables, namely Real Effective Exchange Rate, weighted GDP and Output Gap. This article is particularly oriented towards the study of long-term relationships between the exchange rate and global exports performance, on the one hand; and between exchange rates and intra-European exports performance, on the other. Two measures of exchange rate are considered: a global real exchange rate to investigate the impact of exchange rates on overall exports and an intra European real exchange rate calculated to detect its effect on intra-European trade. The study shows that there is a big difference between the impact of exchange rates on exports before and after the establishment of the European Monetary Union on the one hand, and between the impacts of exchange rates on intra-European global exports on the other hand.

The foreign exchange rate always changes and impacts many economic issues. One of these issues is the impact of the foreign exchange rate on the balance of payments. Our research focuses on the impact of the exchange rate on Vietnam’s balance of payments. All data was collected from the Vietnamese State Bank in the period from 2000 to 2020. We applied the model with the unit root, Auto-Regressive Distributed Lag (ARDL), and Granger Causality Test to evaluate the impact of the foreign exchange rate on the balance of payments. The findings indicated that Vietnam’s foreign exchange rate has a significant positive impact on the balance of payment. The result implied that when the foreign exchange rate is stable, it seems to create a developed and effective economic environment. All these contributions are an important base for improving Vietnam’s balance of payments as well as Vietnam’s economy. By deeply analyzing issues of Vietnam’s foreign exchange rate and its effect, we propose some orientations and solutions for Vietnam’s government and managers in issuing suitable economic policies in the future.

One of the economic variables used in economic policies to achieve economic stability is the exchange rate. The purpose of this research is to examine the impact of changes in exchange rates of the Iraqi dinar on Some macroeconomic variables during the period (1990-2021). The study used a descriptive and analytical approach based on time series data, employing models (DLOS, FMOLS, CCR, ARDL) to prove the impact of the exchange rate on GDP, inflation rate, unemployment rate, inflation rate, and Iraqi exports. Finally, the study concluded that there is a positive relationship between the exchange rate of the Iraqi dinar and GDP, implying that the exchange rate provides for economic growth and that there is a negative relationship between the exchange rate of the Iraqi dinar and the rate of inflation in Iraq, implying that the exchange rate aids in the reduction of inflation rates in Iraq. Furthermore, the exchange rate had no effect on unemployment rates, i.e., the change in the exchange rate of the Iraqi dinar had no effect on reducing the percentage of people who are unemployed. The econometrics analysis also found that the impact of the Iraqi dinar exchange rate in Iraq was negative and did not contribute to an increase in total exports, which is consistent with the reality of the Iraqi economy because foreign trade in Iraq suffers from a major structural imbalance represented by the control of crude oil as a raw material on more than (٪95) of its exports, so oil prices are unaffected by the exchange rate of the Iraqi dinar. According to the study, one of the most essential ways to achieve genuine exchange rate stability and increase the link between the exchange rate and macroeconomic variables is to pursue an economic diversification policy.

Exchange rate is act as the main role in the integral part of the economic development .India is also facing this issue like other Asian countries impact of increase exchange rate on the growth of the economy .It is source of the external funds and act as the channel between risk and investment. In this research, we have taken the data from 1998 to 2008 and applied the ADF test, normality test and Jarqu e-Bera statistics test for taking the proper results about the impact of exchange rate on the development of India. Normality test explains the nature of the data .our results are showing that increase exchange rate has negative impact on the stock exchange of India .our suggested that Government should focus about the exchange rate policy.

Currency Exchange Rate as a Tool of Strategic Analysis (Evidence from Russian Industry)

Exchange rate is act as the main role in the integral part of the economic development. India is also facing this issue like other Asian countries impact of increase exchange rate on the growth of the economy. It is source of the external funds and act as the channel between risk and investment. In this research, we have taken the data from 1998 to 2008 and applied the ADF test, normality test and Jarqu e-Bera statistics test for taking the proper results about the impact of exchange rate on the development of India. Normality test explains the nature of the data. Our results are showing that increase exchange rate has negative impact on the stock exchange of India. Our suggested that Government should focus about the exchange rate policy.

Studies focusing on the determinants of foreign direct investment (FDI) inflow to Sub‐Saharan African countries remain fairly limited. Such existing research mostly focuses on the level of the exchange rate, often ignoring its volatility. This paper assesses the impact of the real exchange rate and exchange rate volatility on FDI flows for the case of Mauritius, one of the best economic performers on the continent. Using dynamic time series analysis, namely a Vector Error Correction Model, over the period 1976–2018, exchange rate volatility was found to negatively impact FDI while depreciating real exchange attracts foreign investors. The openness level, wages, literacy level and tax are also observed to be ingredients of FDI in both the long and short term. Moreover, the analysis validates the dynamic nature of FDI in Mauritius.

دراین مقاله با استفاده از داده های سالیانه 1355تا1388 به بررسی تاثیر نرخ واقعی ارز بر صادرات صنایع چوب و همچنین صنایع کاغذ، پرداخته ایم. برای این کار ابتدا با استفاده از الگوی خود توضیح برداری (VAR) و بر اساس روش یوهانسون، توابع عرضه و تقاضا برای صادرات این صنایع برآورد می شود، سپس با استفاده از مدل تصحیح خطا به تلفیق رابطه کوتاه مدت و بلند مدت آن ها می-پردازیم. همچنین اثر شوک ها و میزان اثرپذیری یک متغیر درونزا بر سایر متغیرهای مدل (با توجه به مدل های تخمینی) نشان داده می شود. نتایج تحقیق نشان می دهد که نرخ واقعی ارز بر عرضه و تقاضای صادرات این دوصنعت تاثیر مثبت و معنی داری دارد. همچنین نرخ تعرفه وارداتی نیز تاثیر منفی بر عرضه صادرات این صنایع دارد.متغیرهای درآمد و ارزش افزوده نیز تاثیر مثبتی در توابع تقاضا و عرضه این صنایع داشته اند. جهت تخمین مدل ها از نرم افزار Eviewsاستفاده شده است.

This study is motivated by the urgency to maintain the operational efficiency of Indonesia’s banking sector amid ongoing global economic uncertainty in the post-COVID-19 era, exchange rate volatility, inflationary pressures, and the dynamics of both domestic and international monetary policies. Banking efficiency is a crucial factor in sustaining competitiveness and ensuring the stability of the financial system, especially when facing persistent external pressures. The main objective of this study is to analyze the impact of key macroeconomic variables exchange rate, inflation, the Bank Indonesia 7-Day Reverse Repo Rate (BI7DRR), and money supply on the efficiency of Indonesian commercial banks during the 2018–2024 period. Bank efficiency is measured using the Operating Expenses to Operating Income (OpEx) ratio, which reflects the bank’s ability to manage its operational costs effectively. The study employs the Error Correction Model (ECM) to capture both the short-term and long-term relationships between macroeconomic variables and banking efficiency. The results reveal that exchange rate fluctuations have a significant impact on bank efficiency in the short term, while inflation and money supply exert significant influence in the long term. Conversely, BI7DRR does not show a significant effect in either the short or long term. These findings suggest that banks’ responses to macroeconomic pressures are dynamic and gradual, requiring continuous strategic adjustments. This research contributes to the literature on banking economics in developing countries and provides practical recommendations for policymakers and banking industry stakeholders in formulating monetary policies and operational strategies that are adaptive to volatile economic conditions.

The most contentious and unresolved issues in the World Trade Organisation (WTO) agricultural negotiations have been disciplining trade-distorting support and reducing barriers to agricultural trade. One of the contemporary issues that has serious implications on WTO agricultural reforms is the commitments of the United Kingdom (UK) after Brexit. The UK has based its commitments and concessions on the schedule of the EU-28 and redenominated the currency components from Euros to Pounds using a recent exchange rate. The study examines the impact of exchange rate on the policy space of the UK to provide tradedistorting support and restrict agricultural exports of other countries. This article highlights the impact of recent exchange rate on the UK’s agricultural commitments under domestic support and market access. The result shows that the use of recent exchange rate leads to additional entitlement to distort trade, increased flexibilities to implement market price support (MPS), and additional policy space to restrict agricultural imports through higher bound tariff, in-quota tariff rates, and special agricultural safeguards. Overall, this approach will undermine the fundamental objective of the Agreement on Agriculture (AoA) to substantially reduce agricultural support and protection, and consequently, exacerbate the inequities and imbalances rooted in the agreement.

This study makes examination of the moderating effects of oil price on the impact of inflation, exchange rate and interest rate variables on stock market performance as proxied by the Tanzania All Share Index. It uses monthly time series from January 2009 to December 2019. The model capturing the direct impact of the macroeconomic factors on the index of stock market shows that exchange rate and interest rate exert positive and significant impact on the stock market performance, while, inflation has negative and significant effects on the stock market performance. The moderating effect model shows that oil price has a moderation effect on the effect of inflation on stock market performance. It also reveals that the impact of exchange rate on stock market performance is strengthened by changes in oil price thus suggesting a positive moderation. The results imply that a growing economy and oil importing country like Tanzania needs to properly model its macroeconomic variables with oil price in order to improve performance of stock market.

PurposeThe purpose of this paper is to examine the impact of real effective exchange rates (REER), both in terms of levels and volatility, on the export performance of India’s sub-national economies, given the recent slowdown in India’s exports.Design/methodology/approachIndia’s export distribution is highly asymmetric, with 90 percent of India’s exports concentrated in 11 sub-national economies. Exploiting this concentration, this paper constructs a panel data set using available data between 2002 and 2014 to understand the relationship between REER and exports from the top exporting cluster. Moreover, the paper constructs a sub-national competitiveness index to capture the supply capacity of the states.FindingsThe empirical findings of this paper reveal that a higher REER volatility deters exports and movements in REER do not matter as much as volatility. The most significant finding of the paper is that state competitiveness is the most crucial factor affecting trade. Therefore, policy makers at the state level must lay more emphasis on the supply side such as addressing logistical bottlenecks to help revive exports growth.Originality/valueThis study makes a departure from the plethora of extant aggregate-level studies by examining the relationship between REER and exports at the sub-national level for India. Considering the highly skewed distribution of India’s exports, the study provides important insights into the exporting patterns and determinants that are at play at the sub-national level.

The purpose of the analysis of the impact of exchange rates on macroeconomic factors of Lao PDR from 2012-2022 aims to (1) analyze the fluctuation of macroeconomic factors and exchange rate of Kip/Dollar and Kip/Baht in the Lao PDR from 2012-2021 and (2) the impact of the exchange rate on the macroeconomic factors of the Lao PDR from 2012-2021. By bringing the collected data to summarize, interpret, consider, select and analyze by using descriptive statistical model and inferential statistics to find a value in percentage, parameter value of regression equation with OLS through E-view 12. The analysis results found that: the exchange rate of Kip/Dollar has effect on the Gross National Income (GNI) of the Lao PDR in the same direction relationship, if the exchange rate changes and increases, it means that the kip of Lao PDR is weak. The country will have the ability to compete in terms of price or make the income from exports that change the value of the kip increase and have a continuous effect on the wages of labor in businesses related to exports, investment and the purchasing power of consumers through income and the economic growth increases, lead to export and investment increase. That will result in the increase of the Gross National Income (GNI) of the Lao PDR. The Consumer Price Index of Lao PDR is continuously increasing, if the Dollar /Kip exchange rate increase by 1 US dollar (USD), it will cause the consumer price index (CPI) of Lao PDR to increase by 1.67% in US dollar (USD). For the exchange rate and export relationship of Lao PDR, it shows that if the exchange rate of Dollar/Kip increase by 1 US dollar (USD), it will result in the export value (EX) of Lao PDR increase by 11.15% US dollar (USD). In other side, the Thai/Kip Baht exchange rate is unable to explain the Gross National Income (GNI), Consumer Price Index (CPI) and Lao PDR's exports clearly, which means that there is no relationship among them, or in other words, the Thai Baht exchange rate does not affect the macroeconomic factors in the model of this research.