Exchange Rate Pass-Through in Sub-Saharan African Economies and its Determinants
Author | : Mr.Ivohasina Fizara Razafimahefa |
Publisher | : International Monetary Fund |
Total Pages | : 57 |
Release | : 2012-06-01 |
ISBN-10 | : 9781475503982 |
ISBN-13 | : 1475503989 |
Rating | : 4/5 (82 Downloads) |
Download or read book Exchange Rate Pass-Through in Sub-Saharan African Economies and its Determinants written by Mr.Ivohasina Fizara Razafimahefa and published by International Monetary Fund. This book was released on 2012-06-01 with total page 57 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper analyzes the exchange rate pass-through to domestic prices and its determinants in sub-Saharan African countries. It finds that the pass-through is incomplete. The pass-through is larger following a depreciation than after an appreciation of the local currency. The average elasticity is estimated at about 0.4. It is lower in countries with more flexible exchange rate regimes and in countries with a higher income. A low inflation environment, a prudent monetary policy, and a sustainable fiscal policy are associated with a lower pass-through. The degree of pass-through has declined in the SSA region since the mid-1990s following marked improvements in macroeconomic and political environments.