Sustainable Exchange Rates When Trade Winds Are Plentiful

Jan Babecký, Aleš Bulíř and Kateřina šmídkova
Additional contact information
Jan Babecký: Czech National Bank, jan.babecky@cnb.cz
Aleš Bulíř: International Monetary Fund, abulir@imf.org
Kateřina šmídkova: Czech National Bank, katerina.smidkova@cnb.cz
Authors registered in the RePEc Author Service: Jan Babecký

National Institute Economic Review, 2008, vol. 204, issue 1, 98-107

Abstract: Estimation and simulation of sustainable real exchange rates in a sample of EU member countries find vulnerabilities connected to the adoption of the euro if the rate vis-À-vis the euro were to be fixed with weak fundamentals and inappropriate policies. Sample countries have benefited from dramatic improvements in their external positions, in part driven by inflows of foreign direct investment. As a result, exchange rate misalignments have narrowed in most countries and, looking ahead, are expected to narrow further. These results are conditional, however, on optimistic projections with respect to world import demand and foreign direct investment inflows.

Keywords: Sustainable real exchange rates; foreign direct investment; ERM2 (search for similar items in EconPapers)
Date: 2008
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://ner.sagepub.com/content/204/1/98.abstract (text/html)

Related works:
Journal Article: Sustainable Exchange Rates When Trade Winds Are Plentiful (2008)
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:sae:niesru:v:204:y:2008:i:1:p:98-107

Access Statistics for this article

More articles in National Institute Economic Review from National Institute of Economic and Social Research Contact information at EDIRC.
Bibliographic data for series maintained by SAGE Publications ().