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Exchange Rate Misalignment and Its Relationship to Output Growth in South Africa / Ha Nguyen.
World Bank Open Knowledge Repository (formerly "World Bank E-Library Publications") Available online
View online- Format:
- Book
- Government document
- Author/Creator:
- Nguyen, Ha.
- Series:
- Other papers.
- World Bank e-Library.
- Other papers
- Language:
- English
- Subjects (All):
- Currencies and Exchange Rates.
- Economic Growth.
- Economic Theory and Research.
- Exchange Rates.
- Finance and Financial Sector Development.
- Macroeconomics and Economic Growth.
- Purchasing Power Parity.
- Local Subjects:
- Currencies and Exchange Rates.
- Economic Growth.
- Economic Theory and Research.
- Exchange Rates.
- Finance and Financial Sector Development.
- Macroeconomics and Economic Growth.
- Purchasing Power Parity.
- Place of Publication:
- Washington, D.C. : The World Bank, 2018.
- System Details:
- data file
- Summary:
- This paper establishes a simple theory-based real exchange rate (RER) Misalignment Index for countries around the world from 1950-2014, and shows that South Africa's RER has been undervalued over the last decade. For the most recent year of 2014, depending on the proxy for productivity, it is undervalued from about 15 percent to 18 percent. The analysis suggests that terms of trade fluctuations explain a large part of the undervaluation. This study is a background note for the South Africa Systematic Country Diagnostic.
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