Real exchange rate volatility and business cycles in emerging market economies

Inci Gumus and Zeren Tatar Taşpınar

Economics Letters, 2015, vol. 134, issue C, 127-129

Abstract: This paper analyzes how real exchange rate volatility affects business cycles through the cost of foreign currency borrowing. The results show that output volatility increases by up to 22% as the share foreign-denominated debt increases from 0 to 100%.

Keywords: Real exchange rate; Denomination of debt; Business cycles (search for similar items in EconPapers)
JEL-codes: E32 F32 F41 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:134:y:2015:i:c:p:127-129

DOI: 10.1016/j.econlet.2015.07.011

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