Impact of Exchange Market Forces on Pak-Rupee Exchange Rates during Globalization Period: An Empirical Analysis

Syed Adnan Haider Ali Shah Bukhari (), Muhammad Shahbaz and Mohammad Sabihuddin Butt ()
Additional contact information
Syed Adnan Haider Ali Shah Bukhari: Corresponding Author: Senior Research Fellow, Faculty of Computer Sciences and I.T. Department of Computer Sciences, FUUAST, Karachi, Pakistan.
Mohammad Sabihuddin Butt: Associate Professor/Senior Research Economist, Applied Economics Research Centre, Karachi University, Pakistan.

Lahore Journal of Economics, 2006, vol. 11, issue 1, 121-139

Abstract: This paper analyzes the impact of exchange market forces on Pak-Rupee/US dollar exchange rates during the 1965-1971 globalization period. The main findings are that a) the behavior of Pakistan’s fundamentals relative to those of the USA help to explain exchange market forces against the Pak-Rupee; b) during the run up todevaluation in the globalization period the monetary authorities in Pakistan were acting to reduce domestic credit; but that c) additional pressurewas brought against the Pak-Rupee from speculative sources. These findings relate to current thinking on the choice of the exchange rate regime as even well behaved fundamentals may not be sufficient to sustain a currency on its peg.

Keywords: Exchange market forces; pegged exchange rates; realignment expectations. (search for similar items in EconPapers)
JEL-codes: C53 E58 F31 F33 (search for similar items in EconPapers)
Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://121.52.153.179/JOURNAL/Vol-11No1/Syed%20Adnan%20Haider.pdf (application/pdf)

Related works:
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:lje:journl:v:11:y:2006:i:1:p:121-139

Access Statistics for this article

More articles in Lahore Journal of Economics from Department of Economics, The Lahore School of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Shahid Salahuddin ().