External debts, current account balance and exchange rates in emerging countries

Taoufik Bouraoui

Economics Bulletin, 2019, vol. 39, issue 4, 2333-2342

Abstract: This article aims to study the relationship between exchange rates, current account balance, and external debts in a sample of 13 emerging countries. We use quarterly data over the period 2000Q1–2016Q4. Based on VECM approach and ARDL model, the main common finding for the selected countries is that for most countries the fluctuation of exchange rates is driven by the accumulation of external debts and/or large current account imbalance, especially in the long-run. While in some countries, only unidirectional causality is pointed out, in other countries, we find bidirectional causality between variables, implying that external debts and current account balance are also influenced by the trend of exchange rates.

Keywords: macroeconomic fundamentals; VECM; ARDL; emerging markets (search for similar items in EconPapers)
JEL-codes: E4 F3 (search for similar items in EconPapers)
Date: 2019-10-13
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2019/Volume39/EB-19-V39-I4-P217.pdf (application/pdf)

Related works:
Working Paper: External debts, current account balance and exchange rates in emerging countries (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ebl:ecbull:eb-19-00062

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Bibliographic data for series maintained by John P. Conley ().