Commodity Currencies and the Real Exchange Rate

Paul Cashin (), Luis Cespedes and Ratna Sahay

Working Papers Central Bank of Chile from Central Bank of Chile

Abstract: This paper examines whether the real exchange rates of commodity-exporting countries and the real prices of their commodity exports move together over time. Using IMF data on the world prices of 44 commodities and national commodity export shares, we construct new monthly indices of national commodity export prices for 58 commodity-exporting countries over 1980-2002. Evidence of a longrun relationship between national real exchange rate and real commodity prices is found for about onethird of the commodity-exporting countries. The long-run real exchange rate of these ‘commodity currencies’ is not constant (as would be implied by purchasing power parity-based models) but is time-varying, being dependent on movements in the real price of commodity exports.

Date: 2003-11
New Economics Papers: this item is included in nep-fin and nep-ifn
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

Downloads: (external link)
https://www.bcentral.cl/documents/33528/133326/DTBC_236.pdf (application/pdf)

Related works:
Journal Article: Commodity currencies and the real exchange rate (2004)
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:chb:bcchwp:236

Access Statistics for this paper

More papers in Working Papers Central Bank of Chile from Central Bank of Chile Contact information at EDIRC.
Bibliographic data for series maintained by Alvaro Castillo ().