Exchange Rate Research Articles

Food inflation and monetary policy in emerging economies

The rising inflationary pressure has been linked with supply-side disruptions and rising energy and food prices against the background of the COVID-19 pandemic and the Russia-Ukraine crisis. This paper investigates the role of monetary policy in stabilizing food inflation in emerging economies (India, China, Brazil, Russia, and South Africa). We also investigate the causal linkage between monetary policy and food inflation using frequency domain-based Granger causality and find strong feedback causal effects between food inflation and monetary policy changes. Our results are robust to different estimation methodologies, possible asymmetry, and alternative model specifications, which include climate change. While oil prices, world food prices, and exchange rates have heterogeneous effects on domestic food inflation, a contractionary monetary policy stance leads to a decline in domestic food inflation in all countries. Thus, we provide strong evidence that well-coordinated macroeconomic policies in emerging economies are essential for stabilizing food inflation.

Recent Long-Term Management of Relation Across Czech- Republic Price Indices and Exchange Rates

Recent Long-Term Management of Relation Across Czech- Republic Price Indices and Exchange Rates

Effects of trilemma policies patterns on monetary policy credibility

The open economy trilemma refers to the impossibility of a country fully and simultaneously achieving three political objectives: monetary policy independence, exchange rate stability and financial openness. However, corner configurations related to the three policies of the trilemma are increasingly rare. In fact, countries tend to choose a policy combination composed of partial financial integration, managed exchange rate flexibility and partial monetary independence. Given the possibility of intermediate choices, there exists an index able to measure the relative divergence (or convergence) regarding the policy choices of the trilemma. The index identifies whether countries are adopting similar (or divergent) policy mixes in relation to the trilemma policy options. However, the consequences of adopting a more (or less) convergent policy arrangement on monetary policy credibility are unknown. Hence, this study investigates the effects of trilemma policies convergence patterns on monetary policy credibility. The idea is to verify whether a more convergent arrangement of policies related to the trilemma in open economies helps build monetary policy credibility. Our database is formed by 94 (developed and developing) countries with different characteristics. Thus, we run estimates based on a family of Tobit models for different sub-samples of countries, and also considering different periods – before and after the Global Financial Crisis. The study brings important practical implications. In general, the findings show that a convergent strategy increases credibility. The estimates corroborate the idea that countries adopting divergent policies from the global standard tend to be more exposed to economic instability and, as a result, have difficulties in anchoring inflation expectations.

The Tunisian Central Bank’s Efficiency Benchmarks: A Dynamic Approach

The topic of banking performance and efficiency has received considerable attention, yet there is a noticeable gap in examining the performance and efficiency of central banks. Moreover, there is a scarcity of studies on central bank efficiency. This paper aims to investigate the factors that influenced the efficiency of the Central Bank of Tunisia from 2000 to 2020, using an Autoregressive Distributed Lag Model. The appropriate econometric methodology was first established to achieve this goal, after which the model's results were presented and interpreted. The study's findings indicate that the Tunisian Central Bank’s efficiency is influenced by several macroeconomic (inflation, public deficit, growth rate), international (exchange rate, foreign debt), and political variables (political and government instability, conflict of interest), each with a varying degree of impact. Interestingly, the transition of the Central Bank of Tunisia from a dependent to an independent institution in 2016 did not yield a notable change in efficiency.Copyright© 2024 The Author(s). This article is distributed under the terms of the license CC-BY 4.0., which permits any further distribution in any medium, provided the original work is properly cited.

Characteristics and Efficiency of Heat Transfer for Natural Convection by Ag-CuO/H2O Hybrid Nanofluid Inside a Square Cavity with Corrugated Walls

A parametric numerical study is conducted on laminar natural convection and heat transfer in a cavity with opposing undulated walls saturated with a hybrid Ag-CuO/water nanofluid. The two vertical walls of the sinusoidally undulated cavity are maintained at hot and cold temperatures, while the upper and lower walls are thermally insulated. The investigation examines the effects of relevant parameters such as the sinusoidally undulated geometry of the walls for different volumetric fractions of nanoparticles (0% ≤φ≤6%) and Rayleigh numbers (103 ≤ Ra ≤ 106) Thefinite-volumee discretization method is employed to solve the system of governing equations. The results indicate that an increase in the volumetric fraction of nanoparticles enhances the heat exchange rate in the cavity. Additionally, the Rayleigh number, with a significant increase in surface area, strongly influences the dominant heat transfer mode in the cavity. Furthermore, an increase in the number of wall undulations leads to a reduction in the heat transfer rate.

Aquamimicry feeding system improved growth, physiological status, muscle and intestine histomorphology, and flesh quality of keeled mullet, Liza carinata

The aquamimicry feeding system (AMFS) is one of the modern aquaculture systems that aim to reduce feed costs and water exchange rates to improve the sustainability of aquaculture projects. In AMFS, the aquatic environment is simulated to produce natural food by adding probiotics to carbon sources. Therefore, a 108-day field study was conducted to evaluate the efficiency of AMFS as a solo feed or in combination with a commercial diet for the rearing of keeled mullet, Liza carinata. The L. carinata fingerlings with an initial body weight of 30.0 ± 3.25 g were randomly distributed into three experimental treatments in triplicate rectangular polyethylene ponds (measured 7 × 3 × 1 m) at an initial stocking density of 105 fish per pond. The fish were fed one of the following regimes: the 1st is a commercial floating diet (CFD, 30 % crude protein; T1), the 2nd is a combination of 50 % CFD: 50 % AMFS (T2), the 3rd is a solo of AMFS (T3). Water quality parameters did not differ significantly among different treatments except for a significant reduction in total ammonia nitrogen and a higher zooplankton count in the water of the AMFS group. The fish reared with AMFS as a solo feed (T3) experienced a significant growth performance, somatic indexes, and digestive enzyme activities compared to the fish reared in other treatments. Fish fed AMFS alone (T3) or in combination with CFD (T2) had an improved hematological profile, liver and kidney function indicators, serum lipid, and protein profiles than those fed CFD (T1). Histological and histometric analysis of the intestine showed an improved architecture with AMFS feeding. Furthermore, AMFS feeding increased the diameter of muscle bundles and the protein content of the dorsal muscles. The flesh quality parameters, including water holding capacity, stored loss, drip loss, and frozen leakage rate were improved in fish fed on AMFS alone or in combination with CFD. Therefore, from the above-mentioned beneficial effects of AMFS, it could be used as a promising, economical, and sustainable technology for rearing L. carinata.

Impact of Exchange Rate Fluctuations on Money Velocity in the Egyptian Economy

Impact of Exchange Rate Fluctuations on Money Velocity in the Egyptian Economy

Naringin alleviates fluoride-induced neurological impairment: A focus on the regulation of energy metabolism mediated by mitochondrial permeability transition pore

The neurological impairment induced by fluoride is associated with mitochondrial dysfunction. Normal mitochondrial permeability transition pore (mPTP) opening plays a pivotal role in mitochondrial function. However, it remains unclear whether p53-dependent mPTP-related mitochondrial apoptosis is associated with fluoride-induced neurological impairment, and the alleviation of naringin on those. In vivo, NaF-treated rats had impaired learning and memory abilities, damaged hippocampal structure, and higher respiratory exchange rates (RER). In vitro, the increased apoptosis rates, excessive opening of mPTP, and decreased mitochondrial membrane potential (MMP) were observed in PC12 cells treated with NaF. The protein expressions of p53, CytoC, and cleaved caspase 3 were significantly increased in hippocampi of rats treated with 50 mg/L and 100 mg/L NaF and in 40 mg/L and 80 mg/L NaF-treated PC12 cells, while the protein expression of CypD remains stable. And the changes of p53 and CypD were also confirmed by the immunofluorescence staining in vivo. After inhibiting the expression of p53 with pifithrin-α and p53-siRNA, the decreased apoptosis rates and mPTP opening, increased MMP, and decreased protein expressions of p53, CytoC, and cleaved caspase 3 were observed in NaF-treated PC12 cells. Rats, treated with NaF and naringin, had alleviated impaired neurological function, and had lower RER than rats treated with NaF alone. And compared with those in the NaF group, the decreased apoptosis rates and mPTP opening, and increased MMP were also found in PC12 cells treated with NaF and naringin. Furthermore, hippocampi of rats and PC12 cells treated with NaF and naringin had decreased protein expressions of p53, CytoC, and cleaved caspase 3. Our results indicate that fluoride activates the p53-dependent mPTP-related mitochondrial apoptosis, which then affects energy metabolism, resulting in neurological impairment. Additionally, naringin can alleviate this damage, and further studies on the potential health benefits of naringin are needed.

Better two eyes than one: A synthesis classification of exchange rate regimes

Better two eyes than one: A synthesis classification of exchange rate regimes

Financial Modelling System Using Deep Neural Networks (DNNs) for Financial Risk Assessments

ABSTRACTThe FOREX market assessment is a big challenge for investors and global risk managers. However, the present study uses daily multicurrency exchange rate returns data from 2007 to 2022 to estimate the learning returns performance of the proposed model to find a safe‐haven currency for optimal investment strategy. The categorical returns are classified into good returns (GRs), bad returns (BRs) and no returns (NRs). Therefore, the present study needs to use a one‐hot‐encoding function to convert a categorical dataset into a numeric format with TensorFlow. The present study proposes a deep neural network‐based multilayer perceptron (DNN‐based MLP) with a backpropagation algorithm to estimate the learning returns performance of the proposed model to find a safe‐haven currency for optimal investment strategy. The findings showed that currency exchange rate return 2 (CERR2) is relatively a safe‐haven currency than currency exchange rate return 1 (CERR1) and currency exchange rate return 3 (CERR3). Moreover, the findings also showed that the proposed model gives optimal learning return performance. This study may assist FOREX investors to modify their investment strategies under shed light of findings of the study. In addition, the findings of the present study may also support global risk managers to revisit their hedging strategies.

Bi-level electricity and heat sharing strategy for cross-border integrated energy system based on Nash game

As global energy demands continue to rise and the need for sustainable development becomes more urgent, Cross-Border Integrated Energy Systems (CBIES) offer a crucial pathway to improving energy efficiency and security through international collaboration. This paper proposes a bi-level electricity and heat sharing model based on Nash game theory, which optimizes resource allocation and management in cross-border energy systems. The model addresses two sub-problems: maximizing the overall benefits of the alliance and ensuring fair redistribution of those benefits within the alliance. To tackle the complexities of these problems, the Alternating Direction Method of Multipliers (ADMM) is employed in a distributed manner. Additionally, the ARIMA-GARCH model is introduced to handle the uncertainties related to exchange rate volatility in cross-border energy transactions. Carbon capture and storage (CCS) and power-to-gas (P2G) technologies are also integrated into the cogeneration system to promote low-carbon energy production, aligning with environmental sustainability goals. The results show that the upper-level electricity sharing sub-problem reduced the total operational cost from 1,173,330 CNY to 875,582 CNY after 55 iterations, while the lower-level heat sharing sub-problem further optimized the cost to 687,356 CNY after 14 iterations. Post-cooperation cost comparisons showed that the costs for Country B and Country C were reduced by 207,828 CNY and 390,672 CNY, respectively, demonstrating the model’s effectiveness.

Growth and Depuration of Off‐Flavors in Rainbow Trout Oncorhynchus Mykiss in a Partial Recirculating Aquaculture System (PRAS)

ABSTRACTIn recirculating aquaculture systems (RAS), off‐flavours accumulated in fish muscle tissue can be problematic in terms of consumer acceptance and the reputation of farmed fish products. Off‐flavours often give fish earthy, muddy, or other undesirable flavours. Typically, off‐flavours are removed during a depuration period in which fish are fasted and held in clean water. Unfortunately, this causes additional costs and delayed sales, while fish lose weight and show a decrease in lipid content. First, we studied fish growth in a partial RAS (PRAS) where the conditions are very similar to those in depuration with a water exchange rate of 4000 L kg−1 feed, compared to RAS with a 650‐L water kg−1 feed. Rainbow trout (Oncorhynchus mykiss) was reared in both systems. Our aim was to combine the benefits of a higher water exchange rate: the lack of need for biofilters and a lower accumulation of off‐flavours while obtaining stable rearing conditions. Additionally, we studied the effects of moderate feeding and H2O2 addition during depuration. The fish grew faster in a PRAS than in a RAS when fed ad libitum. Thirteen off‐flavour compounds were found in the fish flesh and 11 in the circulating water. The H2O2 addition led to decreased levels of off‐flavours in the tank water and in fish muscle. The results showed no significant differences in off‐flavours between the fed and not‐fed systems, showing that moderate feeding did not prevent a good depuration result. However, the lipid content and the overall fish weight were higher in the fed systems, which suggests more effective depuration. Increased depuration efficiency can be an important tool when considering ways to improve the profitability of production.

Cyclinaclity Effects of Exchange Rates and Oil Prices

Understanding the concept of time scales is crucial when modeling economic and financial decisions. Within the time-frequency domain, this study delves into the relationship between fluctuations in oil prices and exchange rates across major oil-importing and exporting countries. The investigation employs various cross-wavelet techniques within the continuous wavelet transform framework, with a particular focus on wavelet coherence and phase-difference over the period 2000 to 2020. The results underscore a notable diversity in the connection between the oscillations of oil prices and exchange rates across diverse countries. This relationship is subject to temporal variations and is contingent upon the specific time horizon under consideration. In particular, our analysis reveals strong co-movements between oil prices and exchange rates across various time intervals and frequencies. Importing oil countries like New Zealand, Singapore, Brazil, and Taiwan exhibit particularly pronounced co-movements. Similarly, exporting oil countries such as Kuwait, Mexico, Russia, and Canada also display strong associations between oil prices and exchange rates. These correlations are intricately tied to key macroeconomic events, further highlighting the complex interplay between oil prices and exchange rate movements in different global regions. While a robust connection is evident in numerous countries, the strength of the relationship appears significantly weaker in several others. This variance underscores the nuanced nature of the association between the fluctuations in oil prices and exchange rates across the global landscape.

The impact of the COVID-19 pandemic on the country's national economy: The Indonesian experience

Purpose: This study aims to examine the effects of inflation, exchange rates, and the Covid-19 pandemic on Indonesia's trade balance position and to develop an empirical estimation model to predict its position. Method: The data used in this research are the inflation rate, exchange rate of rupiah to the US dollar, export value, and import value of Indonesia from January 2012 to March 2021. The econometric model used in this study was a binary logistic regression model. Results: The results indicate that The regression coefficient of the inflation rate is negative at 0.3621, with an odds ratio of 0.696. This suggests that 1 percent in inflation reduces the probability of a trade balance surplus of 0.696. The regression coefficient for the exchange rate was positive at 2.18, with an odds ratio of 8.85. This means that every 2.72 rupiah increase in the exchange rate raises the probability of a trade balance surplus of 8.85 times. However, this study does not find empirical evidence that inflation, exchange rates, and pandemic of Covid-19 have no impact on the position of Indonesia's trade balance. Limitations: This study focuses on two factors believed to influence the position of trade balance in Indonesia: the inflation rate and foreign exchange rates. Contributions: This study provides insights into government policy.

Transfer Pricing Decisions: Tax Income, Exchange Rate, Tunneling Incentive and Multinationality

Transfer pricing can be misapplied by the company by transferring taxable income to subsidiaries and companies with special relationships to significantly push down the tax expense. This research aims to determine factors that can affect transfer pricing decisions. Those factors include tax income, exchange rates, tunnelling incentives, and multinationals. The research object of this research is a company from the consumer non-cyclical sector listed on the Indonesia Stock Exchange (IDX) from 2017 to 2021. The samples are eight companies selected with purposive sampling technique, resulting in 40 observation data. The analysis technique implemented in this research is panel data regression tested Eviews12. This research reveals that tax income and tunnelling incentives negatively influence transfer pricing decisions. At the same time, the exchange rate and multi-nationality do not affect transfer pricing decisions. Variable tax income, exchange rate, tunnelling incentives, and multinationals have simultaneously affected transfer pricing decisions.

Dynamics of Stock Prices and Exchange Rate with Structural Breaks and Asymmetry: Evidence From Türkiye

This study investigates the impacts of the nominal exchange rate on Turkish stock prices using a structural break cointegration test with endogenously determined multiple structural breaks and an asymmetric cointegration test for the period of 2002-2021. The study differs from previous research on this relation in two respects. First, it takes into account structural breaks in relation to both regimes and trends (C/S/T). Second, it extends the asymmetric cointegration with multiple structural breaks. The findings of structural break cointegration capture the break dates in line with the Turkish economics dynamics and reveal the negative effects of the exchange rates on stocks, with their significance and magnitude differing in regimes. Similarly, NARDL results indicate that negative and positive exchange rate shocks exhibit asymmetric effects on stocks for both the whole period and regimes. The overall findings demonstrate that exchange rate variations have distinctive impacts on stock prices when considering structural break and asymmetrical dynamics. In this background, policymakers and foreign investors need to take into account these dynamics when dealing with Turkish financial markets.

Nexus between Monetary Indicators and Bitcoin in Selected Sub-Saharan Africa: A Panel ARDL

The rapid adoption and growing prominence of Bitcoin and other cryptocurrencies have sparked significant interest and debate among economists, policymakers, and financial analysts. In Sub-Saharan Africa, where traditional financial systems often face challenges such as limited access to banking services, high transaction costs, and volatile currencies, Bitcoin presents both opportunities and risks. Understanding the interplay between Bitcoin and key monetary indicators such as monetary aggregates, exchange rates, and interest rates can provide valuable insights for policymakers and stakeholders in these economies. This study therefore seeks to investigate the nexus between monetary indicators and Bitcoin in selected Sub-Saharan African countries using a Panel ARDL (Autoregressive Distributed Lag) approach. The analysis focuses on understanding the dynamic relationship between key monetary variables, such as monetary aggregates, exchange rates, interest rates, and Bitcoin prices, from 2010 quarter three to 2022 quarter four. The findings reveal several significant relationships between monetary indicators and Bitcoin across the selected Sub-Saharan African countries. In the short run of the Panel Ardl monetary aggregates exhibit a positive relationship with Bitcoin prices, indicating that changes in the money supply may influence the demand for cryptocurrencies. Conversely, both exchange rates and interest rates show a negative relationship with Bitcoin prices in the short run, suggesting that currency depreciation and higher borrowing costs may reduce demand for Bitcoin. In the long run, the relationship between monetary aggregates and Bitcoin remains positive, emphasizing the potential influence of money supply on cryptocurrency markets over time. However, the significance of exchange rates diminishes, indicating a less pronounced impact in the longer term. Interestingly, interest rates continue to exhibit a significant negative relationship with Bitcoin prices in the long run, highlighting the persistent effect of borrowing costs on cryptocurrency demand. These results have important implications for policymakers, investors, and researchers interested in the intersection of monetary policy and cryptocurrency markets in Sub-Saharan Africa. Policymakers may consider the impact of monetary policy decisions on cryptocurrency adoption and market dynamics, while investors can use these insights to inform their investment strategies.

Pengaruh Nilai Tukar, Inflasi, Produk Domestik Bruto terhadap Ekspor Karet Indonesia Periode 2015 sampai dengan 2022

This study aims to analyze the influence of exchange rate, inflation rate, and Gross Domestic Product (GDP) growth on Indonesian rubber exports during the period of 2015-2022. The objective of this research is to understand the dynamics of economic factors affecting Indonesian rubber exports and their potential contribution to the national economy. A quantitative research method was employed, utilizing regression analysis to test hypotheses regarding the relationship between the aforementioned variables. Data were obtained from official sources such as Bank Indonesia and the Indonesian Central Statistics Agency (BPS), encompassing exchange rates, inflation rates, GDP, and rubber export data. The analysis indicates that the exchange rate does not significantly influence Indonesian rubber exports. However, the inflation rate exhibits a significant positive impact on rubber export volume, while GDP growth shows a positive but insignificant influence. Simultaneously, exchange rates, inflation rates, and GDP collectively demonstrate a significant impact on rubber exports. This study underscores the importance of considering the economic factors examined in designing policies and strategies to enhance rubber exports in Indonesia. With a deeper understanding of these factors, it is hoped that better guidance can be provided for economic development in the rubber sector and, consequently, for the national economy.

Energy price reforms, exchange rate devaluation and macroeconomic instability: Evidence from Bayesian VAR identified with sign‐and‐zero restrictions

AbstractThis study sets out to examine the effects of the interaction of subsidy removal on premium motor spirit (PMS) and exchange rate devaluation on macroeconomic instability in Nigeria. In this regard, this study adopted the Bayesian vector autoregressive model (BVAR) identified with sign‐and‐zero restrictions for annual data between 1985 and 2022. The empirical results reveal that both the removal of subsidies on PMS and the devaluation of the naira exchange rate significantly undermine real gross domestic product (GDP) growth and raise inflationary pressures in Nigeria. One important implication of this finding is that the ongoing subsidy reforms in the energy sector and associated devaluation of the naira exchange rate raise the risk of stagflation in Nigeria. Secondly, the simulation shows that simultaneous subsidy removal on PMS and exchange rate devaluation can trigger macroeconomic instability. This finding implies that stabilising PMS price and the exchange rate is key to achieving macroeconomic stability in Nigeria. Thus, this study recommends that Nigeria should be cautious and act quickly to cushion the price of PMS from the vagaries of foreign exchange market fluctuations to improve macroeconomic stability in the country.

Comparative Analysis of Economic Forces and Stock Market Movements: The U.S. and Indonesia

The economies of many developed and developing countries are experiencing instability, characterized by a decline in economic performance. In a macroeconomic context, global instability affects several key indicators such as production indices, exchange rates, interest rates, and inflation rates. The occurrence of shocks to macroeconomic indicators certainly increases the volatility of a country's capital markets. This quantitative research examines the correlation of shocks to each key indicator of capital market performance in Indonesia and the United States. This research uses the VECM method. The research shows that the influence of macroeconomic indicators tends to fluctuate in the short term and is stable in the long term. Where the production and inflation indices have a positive and significant effect on the IDX Composite and the DJI, this is different from interest rates, which negatively impact the IDX Composite and DJI. Meanwhile, the exchange rate indicator has no significant effect on IDX Composite or DJI. The research also found that the IDX Composite was predominantly influenced by exchange rates and inflation, while the DJI was predominantly influenced by production index indicators, inflation, and interest rates.