Business Intelligence

The Changing Role Of The Exchange Rate In A Globalised Economy

Download Now Free registration required

Executive Summary

In addition to its direct effects on the global trading and production structure, the ongoing process of globalisation may have important implications for the interaction of exchange rates and the overall economy. This paper presents evidence regarding possible changes in the role of exchange rates in a more globalised economy. First, it analyses the link between exchange rates and prices, showing that there is at most a moderate decline in exchange rate pass-through for the euro area. Next, it turns to the effect of exchange rate changes on trade flows.

  • Format: PDF
  • Size: 1121.2 KB