Evolution and Characteristics of the Exchange Rate Pass Through to Prices in Mexico
Angeles Galvan Daniel,
Cortés Espada Josué Fernando and
Daniel Samano ()
No 2019-10, Working Papers from Banco de México
This paper analyzes the exchange rate pass through to consumer prices in Mexico using different methodologies. First, we estimate Vector Autoregressive Models (VAR). Subsequently, we estimate Autoregressive Distributed Lags Models (ARDL) in order to make a long run analysis. In particular, we find that the exchange rate pass through to consumer prices is low and has barely changed in relation with the findings in previous studies. We also estimate that when the economy grows above its long-run trend, the point estimation of the exchange rate pass through is larger on average. Finally, we provide some evidence of asymmetry in the exchange rate pass through, that is, the point estimation of the exchange rate pass through is greater when there is a depreciation than when there is a currency appreciation. It should be noted that in the long run analysis these results are preserved.
Keywords: Depreciation; Inflation; Exchange Rate Pass Through; Asymmetries (search for similar items in EconPapers)
JEL-codes: C22 C32 E31 F31 F41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac, nep-mon and nep-opm
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
http://www.banxico.org.mx/publications-and-press/b ... -753AD4FBB1E6%7D.pdf (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bdm:wpaper:2019-10
Access Statistics for this paper
More papers in Working Papers from Banco de México Contact information at EDIRC.
Bibliographic data for series maintained by Dirección de Sistemas ().