Nonlinear Mechanism of the Exchange Rate Pass-Through: Does Business Cycle Matter?

Exchange rate pass-through in Iran: Exchange rate effects on the consumer price index

The purpose of this study is to find an accurate estimate of the exchange rate-CPI relationship in Iran over the past three decades. The results of the Granger causality test in the frequency domain demonstrate a strong causation from the exchange rate to CPI especially in the long run. The results of the wavelet analysis show that in the currency crisis periods, the exchange rate-CPI correlati...

The Adjustment of Global External Balances: Does Partial Exchange Rate Pass-Through to Trade Prices Matter?

This paper assesses whether partial exchange rate pass-through to trade prices has important implications for the prospective adjustment of global external imbalances. To address this question, we develop and estimate an open-economy DGE model in which pass-through is incomplete due to the presence of local currency pricing, distribution services, and a variable demand elasticity that leads to ...

The Impact of Monetary Regime on the Exchange Rate Pass-Through under Exchange Rate Volatility (Dynamic Panel Data Approach)

Monetary Policy, Exchange Rate Flexibility, and Exchange Rate Pass-Through

This paper develops a dynamic general-equilibrium (DGE) model of a small open economy to investigate alternative monetary rules, differing primarily in the degree to which they allow for exchange rate flexibility. A central argument of the paper is that the nature of the trade-off between fixed and floating exchange rates may be quite different in mature industrial economies than in emerging-ma...

The Exchange Rate Asymmetric Pass-Through to Import Price Index: The Case Study of Iran

The main objective of this paper is to investigate the asymmetric effects of exchangerate on Iranian import price index using quarterly time series data over the period 1990- 2011. For this purpose, positive and negative shocks of the exchange rate have been separated from each other using dummy variables and the effects of the size of the exchange rate shocks by determining a threshold.The emp...