Currencies Of Countries Research Articles

Euroization of the Economy and the Negative Impact of the Strengthening of the Local Currency on Exports and Other Economic Indicators in Albania

The Albanian economy is a small and open economy. As such, it is quickly influenced by the turbulence of the global, European, and regional economies. Economic theory emphasizes the link between the exchange rate, exports, the consumer price index, and the balance of foreign trade. The purpose of this article is to study the impact of the exchange rate, primarily at the export level, while also considering other economic factors within the framework of the overvaluation of the Albanian currency (ALL) against the currencies of partner countries, mainly the Euro. The overvaluation of the Albanian currency has led to discouraging exports and increasing imports, influencing the rise in the Consumer Price Index, meaning higher consumer prices. This is due to the fact that the Albanian economy is mainly dependent on imports. The empirical and econometric models used, along with the factors included in this study according to the hypotheses raised, are related to assessing the mutual relationships of the exchange rate with other economic factors for the time period 2018-2023.The results imply and depict the integrated relationship between the exchange rate and exports and other economic factors, as well as supporting the fact that the real exchange rate (RER) has deviated from its equilibrium level. The conclusions in this study confirm that an overvalued domestic currency has increased costs for operations conducted in the local currency ALL, reducing income for operations conducted in Euro and other currencies. This overvaluation of the domestic currency has resulted in losses for exporting companies, impacting the trade balance. Based on the findings in this study, it is crucial for financial institutions and policymakers to be consistent in monitoring the exchange rate, especially EUR/ALL, to improve the long-term relationships between the exchange rate, exports, and other economic factors.

Detecting anomalies in currency market of BRICS countries: insights into emerging economies

PurposeThe primary motive of the research paper is to investigate the efficiency of currency market of emerging economies (BRICS countries), by analyzing the presence and consistency of calendar anomalies – specifically the day-of-the-week (DOW) effect, the January effect and the Turn-of-the-month (TOM) effect. Daily data of around 23 years and 4 months were examined for the purpose of study. Segmented data of 8-year intervals were also analyzed to observe the changes in the pattern over a period. The findings are intended to offer insights into market behaviors and potential trading strategies for astute traders.Design/methodology/approachThe study employed a quantitative research design utilizing ordinary least squares regression with dummy variables and Generalized AutoRegressive Conditional Heteroskedasticity (GARCH) (1,1) model. To study the calendar anomalies, the daily closing price of five currency pairs has been taken from Bloomberg’s software. The Kruskal–Wallis test was conducted to validate and check the robustness of analysis.FindingsThere are mixed results regarding calendar anomalies in the BRICS currency markets. Analysis of aggregate data revealed that DOW effect is present in all the currencies except USDZAR, with Monday showing positive return. The segmented analysis showed the presence of DOW effect in USDCNY and USDINR, while other currencies lacked consistent patterns. The January effect was evident for Indian Rupees and Chinese Yuan but not for other currencies. TOM effect was present only in Chinese Yuan. Overall, the Indian Rupee and Chinese Yuan displayed inefficiencies, indicating potential for trading strategies, while other currencies appeared efficient and lacked consistent patterns.Originality/valueThe literature on currency pricing anomalies is sparse, particularly in the context of developing and underdeveloped economies. While some research exists on anomalies within the currencies of developed nations, there is a significant gap in studies focusing on emerging economies. This paper seeks to address this deficiency by investigating the presence of calendar anomalies in the currencies of BRICS countries, providing new insights into the behaviors of these emerging economies.

The Effect of Exchange Rate Volatility on Foreign Tourist Visits in Indonesia: GARCH Analysis

In this era of globalization, currency exchange rates are one of the crucial factors affecting a country's economy. The exchange rate of a country's currency plays an important role in economic stability and international trade, especially in the tourism sector. This study aims to conduct an in-depth analysis to identify patterns of rupiah exchange rate volatility using the Generalized Autoregressive Conditional Heteroscedasticity (GARCH) model, and then examine whether these patterns have a significant correlation with the number of foreign tourist arrivals in Indonesia. In analyzing the data, researchers conducted several classical assumption tests, namely the normality test and the heteroscedasticity test. The test results show that the data used, namely the rupiah exchange rate data and the number of foreign tourist visits, are not normally distributed and heteroscedastic. In this case, it resulted in researchers not use the Pearson correlation test so they used the Kendall-Tau correlation test and Granger Causality test which resulted in the two variables being correlated. Furthermore, GARCH modeling is carried out which provides forecasting on both data to increase in 2024. The results of this study are expected to provide a basis for consideration for stakeholders to determine policies, especially in the financial and tourism sectors.

DYNAMIC VOLATILITY SPILLOVERS BETWEEN CURRENCIES OF ASEAN MEMBER COUNTRIES AND CHINA: EVIDENCE FROM TVP-VAR APPROACH

Driven by the importance of analyzing interregional volatility spillover effects, this study investigates dynamic volatility spillovers between the currencies of China– ASEAN Free Trade Area (FTA) member countries by applying the time-varying parameter vector autoregressive (TVP-VAR) connectedness approach to a sample spanning January 1, 2006, to October 31, 2022. The results show that (1) dynamic volatility connectedness varies over time and reaches peaks due to economic events, such as the 2008 global financial crisis (GFC) and the COVID-19 pandemic; (2) the Chinese yuan (CNY) market assumes more of a net receiving role for volatility spillovers after the 811 exchange rate reform, while the Singapore dollar (SGD) market assumes more of a net transmitting role for volatility spillovers in the whole sample period and (3) negative spillovers are dominant during the study period, except during the European debt crisis. Our findings can help China and ASEAN establish an exchange rate coordination mechanism to prevent the cross-country transmission of exchange rate risk.

Realized Volatility Spillover Connectedness among the Leading European Currencies after the End of the Sovereign-Debt Crisis: A QVAR Approach

This paper examines the time-varying spillover effects and connectedness between the euro and other EU and non-EU currencies after the end of the sovereign-debt crisis. We employ the Quantile Vector Autoregression connectedness approach using intraday data for seven currencies (the euro, the British pound, the Swiss franc, the Polish zloty, the Hungarian forint, the Czech koruna, and the Norwegian krone) spanning from 1 January 2016 to 30 November 2022. The results indicate that, almost in all quantiles, the currencies of Eastern European Group countries (i.e., Czech Republic, Hungary, and Poland) are net contributors of information spillovers to other currencies, while currencies of non-EU countries (Switzerland, UK, and Norway) are net takers. Further, we find that the euro is the highest transmitter of net information spillovers to all other currencies until 2021. Interestingly, after 2021, the euro changes to net information spillover taker from all other currencies; highlighting that external shocks (e.g., COVID-19, the energy crisis) have significant risk spillover effects on the European currency market. Policymakers and market participants could benefit from knowing which currency drives developments to avoid unexpected consequences.

Analysis of Determinants of the Rupiah Exchange Rate (Exchange Rate) against the US Dollar in 2016: Q1-2023: Q4

In foreign trade, exchange rates are one of the big factors that make a big difference. And although each country has its own currency, they all have different monetary values. To show how much one country's currency is worth compared to another country's currency, we need a measure called the exchange rate. The aim of this research is to find out how the exchange rate is related to things such as the amount of money in circulation, non-oil and gas exports, the balance of payments, and Indonesia's benchmark interest rate. A multiple regression analysis model was used to conduct the research. This research shows that the IDR/USD Exchange Rate is closely related to Indonesia's Balance of Payments, Money Supply (M2), Non-Oil and Gas Exports, and Reference Interest Rates. This relationship is real and good.

Relationship Between Exchange Rate and Inflation in Afghanistan

Afghanistan is an import dependent country and has been facing perpetual trade balance deficit for decades. In case of imperfect competition in the market or existence of market monopoly, there is a higher chance of reflecting the exchange rate changes on the prices of the goods. In Addition, countries with low level of domestic production and higher amounts of imports usually experience higher degree of the exchange rate pass-through effect on inflation. Countries with high import volumes and low export levels often face a deficit in foreign currency inflows and an excess in outflows. These countries need substantial foreign currency to purchase and import goods from both neighboring and international markets, increasing domestic demand for foreign currencies and consequently leading to domestic currency depreciation. This study investigated the relationship between exchange rates and inflation in Afghanistan, examining how exchange rates impact inflation and the benefits associated with exchange rate mechanisms. The primary research questions include: What is the relationship between exchange rates and inflation in Afghanistan? How does the exchange rate influence inflation in the country? What are the benefits of exchange rate systems? The hypothesis posits that higher inflation typically depresses a country's currency value and that exchange rates directly affect inflation. Additionally, exchange rates determine the value of currency exchanges between different nations. This research aims to elucidate the relationship between exchange rates and inflation in Afghanistan, assess the impact of exchange rates on inflation, and explore the benefits of exchange rate systems. The methodology involves a binary system and utilizes secondary data collected from books, websites, and research papers. Findings indicate that Afghanistan's reliance on imports results in a persistent trade balance deficit, with a significant portion of goods, especially non-food items, being imported due to insufficient domestic production. To import goods, Afghanistan requires foreign currencies, which are typically earned through exports of goods and services as of a result, Afghanistan will experience stability in the exchange rate and in the domestic prices.

Protectionism, bilateral integration, and the cross section of exchange rate returns in US presidential debates

We study the impact of US presidential election TV debates on the cross section of intraday exchange rate returns of 96 currencies from 1996 to 2016. The performance of the candidates in the debate is an exogenous shock to the election probability. We find that currencies of countries with high levels of bilateral foreign trade with the US depreciate if the election probability of the protectionist candidate increases during the debate, while no significant impact is detected for countries with bilateral US exports to GDP below 2 percent. Expectations about protectionist measures are the main transmission channel of debate outcomes, while the candidates' stance towards military and immigration play a minor role.

An alternative settlement system for the BRICS countries

The relevance of the research topic lies in the imperatives of the modern geo-economic and geopolitical confrontation between the leading centers of the world financial system and the need to continue to carry out transactions through alternative channels within the existing international system of payments and exchange. Due to the lack of prospects for lifting sanctions against Russia, the author formulates proposals that allow participation in international exchange based on the currencies of friendly countries and a common currency for their entire group. From the point of view of practical implementation, the results of the article allow Russia, through the mechanism of commercial and contract (exchange) rates for currency pairs of monetary units of the BRICS countries, to carry out trade transactions with friendly countries. The author concludes that integration into the current system of world finance through alternative channels allows small countries to join the BRICS group using concession methods through the mechanism of commercial rates.

Commodity currencies revisited: The role of global commodity price uncertainty

Exchange rates of commodity exporting countries, generally known as commodity currencies, are often considered to be driven by some specific commodity prices. In this paper, we show that the uncertainty common to a basket of commodity prices is also a significant driver of exchange rate dynamics for a panel of commodity exporting countries. In particular, an increase in global commodity price uncertainty leads to a short-run depreciation of the effective exchange rate in commodity currency countries, followed by a medium-term rebound. We document that this pattern is specific to commodity currencies and is not visible on benchmark currencies like the euro or the U.S. dollar, the latter acting as a typical safe haven currency. We refer to this pattern as the “commodity uncertainty currency” property.

Terms of trade or market power? Further evidence from dynamic spillovers in return and volatility between Malaysian crude palm oil and foreign exchange markets

This study examines whether the Malaysian ringgit (MYR) provides terms of trade or market power for crude palm oil (CPO). We consider MYR exchange rates against three currencies of major CPO-importing countries, including the Indian rupee (INR), euro (EUR) and Chinese yuan (CNY). Using daily data on Malaysian CPO prices (spot and futures) and foreign exchange rates (INRMYR, EURMYR and CNYMYR) from 2000 to 2018, our results provide three notable findings. First, volatility spillovers from EURMYR to CPO spot and futures are more significant during the global financial crisis of 2008–2009. Second, the return spillovers from CPO spot and futures to INRMYR and EURMYR exchange rates experience significant bursts after the crisis. Third, the volatility of CPO spot price changes shows the predictive ability of the volatility of INRMYR exchange rate changes at the end of 2018. Overall, our findings support that the terms of trade are a driver of the CPO market after the crisis.

A Study on the Exchange Rate Linkage between Korea and China following the Reform of the Yuan Exchange Rate System

Purpose - This study aims to conduct an empirical analysis of exchange rate volatility and dynamic correlation between Korea and China based on the “8.11” central exchange rate reform in China. Unlike other developed countries’ foreign exchange markets, the Chinese Yuan has not yet achieved complete free circulation, and China has an onshore Yuan exchange rate (CNY) and an offshore Yuan exchange rate (CNH). In this study, we investigated the dynamic correlation between Korea’s won exchange rate and China’s onshore yuan exchange rate and offshore yuan exchange rate around the “8.11” central exchange rate reform in China. Design/Methodology – In this study, we attempted to analyze the average and the volatility spillover effect of the won exchange rate from China’s onshore and offshore yuan exchange rate before and after the 8.11 central parity exchange rate reform. In addition, the relation between the won exchange rate and on- and off-shore yuan exchange rate at various stages were analyzed through the VAR model and the VAR-BEKK-GARCH model. Findings – The results of analyzing the volatility spillovers between the KRW exchange rate and the offshore RMB exchange rate show that there are two-way volatility spillovers between the two markets, both before and after the “8.11” central parity rate reform. The dynamic correlation between the two exchange rates (CNY and KRW, CNH and KRW) is increasing over time. In addition, the two exchange rates are positively correlated with each other, implying that the volatility of the two exchange rate markets is moving in the same direction. The dynamic dependence relations between CNY and KRW become significantly higher after the “8.11” central parity rate reform. Originality/value - As a non-international currency, the won must engage in export trade and capital market transactions with other international reserve currency countries. Therefore, it is important for Korean export-import companies and investors to explore changes in the dynamic correlation between the won and the Chinese yuan through exploration.

APPLICATION OF THE FUZZY TIME SERIES CHEN MODEL IN FORECASTING THE RUPIAH EXCHANGE RATE AGAINST THE US DOLLAR (USD)

The importance of the rupiah exchange rate for many individuals in Indonesia in everyday life can be explained by the fact that the country's economy is very dependent on the international economy. Exchange rate used to do future payments using a certain currency and so on the link between two currencies of different countries. In context In international trade, the US Dollar (USD) currency has a very important role very significantly for developing countries because it is used as an eye transaction money. Therefore, the movement of the rupiah exchange rate is an important factor for a country. So forecasting techniques are needed to anticipate exchange rate changes. In this study, the method used is Chen's Fuzzy Time Series (FTS) model to predict the rupiah exchange rate against the United States Dollar (USD) in the future. The results of this study show that forecasting the rupiah exchange rate against the US Dollar (USD) from May 2023 to July 2023 is stable at a value of 1412.40 Rupiah, with a rate average absolute error (MAPE) of 1.6717%.

Role of blockchain technology in changing the structure of a country's monetary base and GDP

This article explores the role of blockchain technology in changing the structure of a country's monetary base. Specifically, it examines the potential benefits and risks of using blockchain in monetary policy, such as efficiency, transparency, and new opportunities for managing the financial system. The article highlights changes in approaches to monetary policy through the use of blockchain-based digital currencies, as well as discusses challenges that may arise in implementing this technology. The conclusions of this article may be valuable for government agencies, central banks, and researchers interested in the impact of blockchain technology on the financial sector. In recent years, the adoption of blockchain technology as an alternative to fiat currencies in various countries around the world has significantly expanded globally, as a significant number of business organizations have recognized the importance of all the advantages that blockchain technology provides. Previously, the focus was on cost control to remain competitive, but lately blockchain technologies have somewhat shifted the significance and monetary mass, influencing the structure of a certain country's monetary base. Based on recent research and publications, the article emphasizes the importance of understanding economic principles that govern the determination of the impacts of various economic and financial indicators on components of economic growth and predicting the consequences of such decisions. It references the seminal work of economists P. Romer, R. Lucas, R. Barro, I. Salla y Martin, and R. Levine, who laid the foundation for studying endogenous economic development. The purpose of this article is to investigate the practice of implementing blockchain technology in the financial support of various economic processes of economic entities and their impact on the structure of a country's monetary base. Thus, it has been identified that the influence of blockchain on the structure of the monetary base itself has received little attention. Despite blockchain being used as an alternative to components of the monetary base, thereby changing its structure within a certain country, most studies focus on literature reviews and provide information for practitioners and academic communities. Therefore, this article aims to bridge the gap by developing a model to identify distortions in the structure of the monetary base under the influence of blockchain. The effective use of blockchain is still being explored. As a result, the operations of many companies using blockchain technologies for payments are vulnerable to technical issues. Blockchain technology is utilized to address this problem and facilitate data exchange among relevant stakeholders. This document presents a benchmark for the impact of blockchain technology on the structure and mass of the monetary base for a specific country, integrating blockchain for sustainable money functioning with the integration of the Internet of Things and big data. Finally, potential benefits and limitations are analyzed during the implementation of this framework. Methods. Macroeconomic analysis, econometric analysis, trend analysis. Results. Determination of the level of influence of blockchain technologies on the change in the structure and volume of the monetary base of a certain country. The study casts doubt on classical economic doctrines by establishing a strong correlation between the distribution of components of the monetary base in its structure and the use of blockchain technology for payments for goods, labor, and services. It emphasizes that the economic growth of a country and the structure of its monetary base depend on the proportion of blockchain technology usage in that country. This research opens up possibilities for further studies in this interdisciplinary field.

Pemodelan ARIMA-GARCH dalam Peramalan Kurs Rupiah Terhadap Yen dengan Masalah Keheterogenan Ragam

The currency exchange rate is the price of a country's currency expressed into another country's currency. At the beginning of 2020, the COVID-19 pandemic affected the weakening and changes in the Rupiah exchange rate against hard currencies, one of which was the Japanese Yen. This affects the expectations of LCS cooperation between Indonesia and Japan in terms of increasing the value of trade to investment between the two countries. Therefore, forecasting the upcoming currency exchange rate is indispensable to determine the upcoming macroeconomic policy. ARIMA is a commonly used quantitative method to forecast future data using past data patterns. The weakness of this method arises when the data violates the assumption of homogeneity of variety that often occurs in financial data, one of which is currency exchange rate data. The ARCH/GARCH model is an effective model for data with uncertain diversity characteristics. However, there is potential to combine ARIMA and ARCH/GARCH into an ARIMA-ARCH/GARCH hybrid model to obtain forecasting results with greater accuracy. In this study, the minimum return data on the Indonesian Rupiah (IDR) exchange rate against the Japanese Yen (JPY) shows the results that the ARIMA(0,0,1) model provides RMSE accuracy of 0.008. While the best forecasting model that can be used to forecast the maximum return data of the IDR exchange rate against JPY is ARIMA(1,0,0)-GARCH(1,1) with a small RMSE accuracy of 0.014. The forecasting results for the minimum return data for buying and selling are expected to strengthen the exchange rate. Meanwhile, the forecasting results for the maximum return data for buying and selling are expected to experience exchange rate weakening.

Development of International Payments in National Currencies in Russia’s Foreign Trade

Foreign trade in goods is one of the most important tools for the development of the Russian economy. On the one hand, foreign trade meets the country’s needs for various goods, the production of which is absent or does not fully satisfy domestic demand. On the other hand, foreign trade allows Russian goods to gain access to international markets, diversifying sales channels. It is important to note that foreign trade activities are impossible without a developed international settlement mechanism, which provides buyers of goods with the opportunity to pay sellers, and sellers with the opportunity to receive foreign exchange earnings for goods supplied. According to established practice in world trade, most international payments are carried out using two reserve currencies: the US dollar and the euro. At the same time, in relation to Russian foreign trade, the use of the US dollar and euro in international payments has become extremely difficult due to the introduction by Western countries of a large number of anti-Russian sanctions, which also affected the sphere of international fi nance. The article analyzes the problems of implementing international payments, based on the results of which specifi c proposals were developed that will contribute to the development of Russian foreign trade. The problems of international payments caused by the introduction of anti-Russian sanctions by Western countries in the fi eld of international fi nance can be solved through an active transition to the national currencies of counterparty countries when concluding international purchase and sale transactions. When trading with countries with which Russia applies a free trade regime, it is advisable to use the Russian ruble as the currency of international settlements. In addition, in order to speed up international payments, it is proposed to switch to electronic document management, which implies the signing of international sales and purchase agreements and the exchange of transaction documents in electronic form using an electronic signature.

YATIRIMCI DUYARLILIĞININ GÜVEN VE BEKLENTİ ENDEKSLERİ ARACILIĞIYLA İNCELENMESİ: DAVRANIŞSAL BİR YAKLAŞIM

In this study, the effect of confidence and expectation indices, which are the factors of investor sentiment, on investment decisions was investigated. In the sample, United States was chosen as an example of a developed country and Turkey was chosen as an example of a developing country. The effects of independent variables on investment instruments were examined with multiple linear regression models, and then generalized autoregressive conditional variance models were created for volatility estimates. Stock index returns (BIST100 and S&P500) and the changes in the total deposit amount in the local currencies of both countries were used as dependent variables. As independent variables, the Consumer Confidence Index, Economic Confidence Index, General Confidence Index and VIX Volatility Index were included for both countries in analyses. The monthly frequency dataset between December 2012 - April 2022 was included. As a result of the regression models, it has been observed that the independent variables generally affect the investments in both countries. As a result of the volatility models, while the independent variables did not have an effect on the investments made in the BIST100 index, it was observed that the variables related to expectations and confidence had a significant effect on the other three investment instruments.

Legal Analysis of Online Foreign Exchange Buying and Selling and Stock Investment Using the Al-Qur'an Interpretation Method

This study aims to find out how the law of buying and selling foreign exchange online and stock investment through the Al-Qur'an detention method. The meaning of foreign exchange or trading is a type of trade or transaction that trades one country's currency against another country's currency (currency pair/pair) which involves the main money markets in the world for 24 hours on an ongoing basis. Stock Investment is the purchase and storage of capital shares in a capital market by investors, both individuals and companies in anticipation of income from dividends and capital gains determining the increased value of these shares. Lately, there have been many fraudulent investment cases under the pretext of buying and selling foreign exchange. This of course attracts the attention of the public to participate in buying and selling foreign exchange which in the end is detrimental to themselves. This study uses a field research method that examines problems or events that occur in society regarding the law of buying and selling foreign exchange or buying and selling shares. This type of research is a case study with a qualitative approach method. From this research, we can find out that if the law of buying and selling foreign exchange online and investing in shares is not in accordance with the Al-Qur'an and Sunnah, it is haram.

Kepastian Hukum Aset Kripto sebagai Instrumen Investasi dalam Persfektif Hukum Islam dan Hukum Positif

Cryptocurrency is a virtual currency without physical form or concrete existence in the virtual world. One of them is Crypto Assets, which are becoming increasingly popular as a means of online payment, even though the government has banned it. In early 2019, the Indonesian government issued regulations legalizing Crypto Assets in Commodity Futures Trading. The use of Crypto Assets as commodities and exchange tools in online transactions has sparked pros and cons among religious scholars and economic experts. This study aims to determine the status of cryptocurrency as a commodity in Indonesia and the opportunities for Crypto Assets as subjects in Sharia commodities on the Commodity Exchange. The theory used is the theory of valid and invalid business transactions in Islam. This research is a literature study and qualitative in nature. The data analysis technique used is analytical descriptive with a normative juridical Islamic law approach. The research found that cryptocurrency can be traded in Sharia commodity exchanges with the condition that the country must protect the trade with legal umbrella and issue cryptocurrency with its value based on gold or the country's currency. Crypto Assets cannot be used as commodities in Sharia Derivative Contracts in Indonesia because they still contain speculation, maysir, and are vulnerable to being used for illegal activities. Therefore, Crypto Assets are haram due to external factors, so it is best to avoid them.

Актуальные тренды развития финансовой инфраструктуры и трансформации валютного рынка России

The article analyzes the main changes in the Russian currency market in the context of modern realities — unprecedented geopolitical pressure, changes in the financial, currency and payment landscape under the influence of sanctions. The purpose of the article is to study the directions of ruble settlements, financial integration and trade in currencies of friendly countries in response to structural changes in the Russian currency market. A significant decrease in the share of the dollar in international payments, reserves and transactions in the foreign exchange market is noted. Much attention is paid to the current trends of dedollarization and diversification of financial markets, which the exchange infrastructure has developed under the influence of difficult external conditions. The authors conducted a study to answer the debatable question of whether the rise in popularity of national currencies was natural or accidental. They support their conclusions with historical statistical data on transactions in the foreign exchange market.