International Trade and Exchange Rate
Kang, Jong Woo | October 2016
Abstract
Tepid trade growth since the 2008/2009 global financial crisis (GFC) has been partly attributed to sluggish demand from developed countries. However, data reveals that developing countries play a bigger role in holding back trade growth, while developed countries show quite robust import growth. Post-GFC, the exchange rate volatility has grown significantly. As decomposition of country groups by changes in currency valuation shows, however, local currency depreciation is not contributing to export growth as much as conventional wisdom dictates. On the other hand, countries with appreciating currencies show rising import intensity and significant export growth. This implies that the more countries undergo currency devaluation—the deeper the degree of devaluation and even competitive devaluations—the more likely international trade will grow slower.
Citation
Kang, Jong Woo. 2016. International Trade and Exchange Rate. © Asian Development Bank. http://hdl.handle.net/11540/8828. License: CC BY 3.0 IGO.ISSN
2313-6537 (Print)
2313-6545 (e-ISSN)
Keywords
Free Trade
Trade Facilitation
Trade
Economic integration
Regional Economic Integration
Intraregional Trade
Macroeconomic
Macroeconomic Analysis
Macroeconomic Framework
Macroeconomic Models
Macroeconomic Performance
Macroeconomic Planning
Macroeconomic Policies
Macroeconomic Reform
Macroeconomic Stabilization
Economic planning
Economic structure
Growth policy
Trade relations
Trade policy
Trade policy
Economic development
Economies in transition
International economy
Border integration
Economic integration
Gross domestic product
Trade policy
Trade Regulations
Exchange Rate
Regional economics
Economic forecasting
Economic development projects
Success in business
Business
Free trade
Business
Economics
Communication in economic development
Restraint of trade
International economic integration
Trade blocs
East-West
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