THE ASYMME THE ASYMMETRIC EX TRIC EXCHANGE RA ANGE RATE PASS-THROUGH T ASS-THROUGH TO INFLATION IN THE SELECTED ASEAN COUNTRIES

Agus Widarjono (), Md. Mahmudul Alam (), Eko Atmadji (), Priyonggo Suseno () and Listya Endang Artiani ()
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Agus Widarjono: Universitas Islam Indonesia
Eko Atmadji: Universitas Islam Indonesia
Priyonggo Suseno: Universitas Islam Indonesia
Listya Endang Artiani: Universitas Islam Indonesia

Bulletin of Monetary Economics and Banking, 2023, vol. 26, issue 1, 105-124

Abstract: This study explains the asymmetric Exchange Rate Pass-Through (ERPT) to inflation in Indonesia, Malaysia, and the Philippines, which adopted the floating exchange rate after the 1998 financial crisis. Our empirical results show the existence of the long-run asymmetric ERPT to inflation such that there is no full transmission of depreciation to inflation in each country. The highest degree of ERPT to inflation occurred in Indonesia, while in Malaysia, and the Philippines depreciation (appreciation) is not completely transmitted in the short run. We find that a depreciation has a stronger impact on inflation than appreciation.

Keywords: Asymmetric; Depreciation; Appreciation; Inflation; Exchange rate (search for similar items in EconPapers)
JEL-codes: E31 F31 F37 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:26:y:2023:i:1d:p:105-124

DOI: 10.59091/1410-8046.2047

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