Large Depreciations: Recent Experience in Historical Perspective
18 Pages Posted: 18 May 2016
Date Written: May 17, 2016
Data for a large sample of countries dating back to the early 1970s reveal that the large depreciations against the dollar that are occurring in many countries are not unprecedented in magnitude or duration. The pass-through to inflation from exchange rate depreciation has been slightly more muted than in previous occasions, but it is not out of line with experience since the mid-1990s. The current account adjustment has been more limited than in the past, possibly suggesting that the period of weak currencies may be prolonged.
Keywords: Current Account Adjustment, Depreciation, Exchange Rate Pass-Through, Inflation
JEL Classification: E31, F31, F32, F41
Suggested Citation: Suggested Citation