The real exchange rate between two currencies combines the nominal exchange rate with the ratio of the price of goods or services in two different countries. The currency exchange rates that we see ...

Most countries hold large gross asset positions, lending in domestic currency and borrowing in foreign. Thus, their balance sheets are exposed to nominal exchange rates. We argue that when asset ...

The Economic Issues series was inaugurated in September 1996. Its aim is to make some of the economic research being produced in the International Monetary Fund on topical issues accessible to a broad ...

Tara Iyer of the University of Oxford’s economics department takes a look at monetary policy in emerging market economies, writing that the majority of households in such economies are excluded from ...

Understanding how to calculate an exchange rate is essential for anyone dealing with foreign currencies, whether you're traveling, investing, or conducting international business. Exchange rates ...

This paper presents a model of an economy that uses nominal exchange rate policy to keep the real exchange rate constant at a certain target level, under an assumption of imperfect asset ...

AROUND $5 trillion is traded on the foreign-exchange markets every single day, according to a recent survey sponsored by the world’s big central banks. That compares with global trade in goods and ...

Exchange rate pass‐through refers to the extent to which fluctuations in the nominal exchange rate affect domestic prices—both at the producer and consumer levels. This dynamic plays a pivotal role in ...

Exchange rate stabilization or currency “pegs” are among the most prevalent interventions in international financial markets. Removing a peg to a safer currency can make the home currency more risky ...