Exchange Rate and External Competitiveness: A Case of Pakistan
Javed, Sajid Amin; Ali, Wajid; Ahmed, Vaqar | December 2016
Abstract
This paper highlights some important points regarding exchange rate and external competitiveness of Pakistan . Firstly, overvalued exchange rate of Pakistani Rupee [PKR] has affected adversely to already weaker external competitiveness of the country . Secondly, claims of failure of depreciation in boosting performance of tradable sector are based on mixing the partial adjustment of PKR towards its equilibrium value during periods of overvaluation with undervaluation - a situation where currency is below its equilibrium value. Thirdly, the gains from depreciation of real exchange rate, during periods of adjustment, were neutralized by loose monetary policy. Fourthly, the State Bank of Pakistan [SBP] needs to develop a tool to assess and monitor the misalignment in PKR so that a better informed and prudent exchange rate policy might be formulated.
Citation
Javed, Sajid Amin; Ali, Wajid; Ahmed, Vaqar. 2016. Exchange Rate and External Competitiveness: A Case of Pakistan. © Sustainable Development Policy Institute. http://hdl.handle.net/11540/9288.Keywords
Macroeconomic
Macroeconomic Analysis
Macroeconomic Framework
Macroeconomic Models
Macroeconomic Performance
Macroeconomic Planning
Macroeconomic Policies
Macroeconomic Reform
Macroeconomic Stabilization
Results-Based Monitoring And Evaluation
Project Evaluation & Review Technique
Project Evaluation
Program Evaluation
Performance Evaluation
Operations Evaluation
Evaluation Methods
Evaluation
Social condition
Economic dependence
Economic assistance
International monetary relations
International monetary relations
International trade
National accounting
Market
Project impact
Development projects
Program management
Performance appraisal
Project appraisal
Technology assessment
Economic indicators
Growth models
Gross domestic product
Macroeconomics
Economic forecast
Exports
Exchange
Comparative economics
Index number
Monetary policy
Value analysis
Adjustment cost
Transaction cost
Conditionality
International relations
Cumulative effects assessment
Grievance procedures
Participatory monitoring and evaluation
Exchange rate
Economic development projects
Economic policy
Economic forecasting
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