How misaligned is the Australian real exchange rate?

Satish Chand

International and Development Economics Working Papers from International and Development Economics

Abstract: This paper uses quarterly data from September 1981 to December 2000 to quantify the extent to which the Australian real exchange rate is misaligned relative to its long-run equilibrium value. Our modelling suggest, that as of December 2000, the real exchange rate was seven percent below its equilibrium value; this figure is modest in comparison to purchasing power parity indicators that suggest considerably greater misalignment. Furthermore, once short-run dynamics are accounted for, even this anomaly disappears.

JEL-codes: E52 Z00 (search for similar items in EconPapers)
Pages: 30 pages
Date: 2001
New Economics Papers: this item is included in nep-ifn and nep-mac
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:idc:wpaper:idec01-2

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