State-Dependent Exchange Rate Pass-Through

Serie

  • IMF Working Papers

Resumen

  • We estimate how the rate of pass-through from the exchange rate to domestic prices varies across states of the economy and depending on the shocks that drive fluctuations in the exchange rate. We confirm several results from the literature and uncover new facts. Drawing on the experience of a large sample of advanced and emerging market economies over the past 30 years, we document that exchange rate pass-through significantly larger during periods of high inflation and elevated uncertainty. Using a novel identification strategy, we also show that pass-through is higher when exchange rate fluctuations are driven by U.S. monetary policy.

fecha de publicación

  • 2023

Líneas de investigación

  • Exchange rate
  • Exchange rate adjustments
  • Exchange rate arrangements
  • Exchange rate pass-through
  • Exchange rates
  • Global
  • inflation
  • inflation uncertainty
  • pass-through
  • pass-through coefficient
  • pass-through from the exchange rate
  • rate of pass-through
  • rate pass-through
  • state-dependence

Issue

  • 2023/086