Download This PaperClimate Risk and Commodity Currencies
49 Pages Posted: 28 Dec 2020
Date Written: 2020
Abstract
The positive relationship between real exchange rates and natural resource income is well understood and studied. However, climate change and the transition to a lower-carbon economy now challenges this relationship. We document this by proposing a novel news media-based measure of climate change transition risk and show that when such risk is high, major commodity currencies experience a persistent depreciation and the relationship between commodity price fluctuations and currencies tends to become weaker.
JEL Classification: C110, C530, D830, D840, E130, E310, E370
Suggested Citation: Suggested Citation
Kapfhammer, Felix and Larsen, Vegard H. and Thorsrud, Leif Anders, Climate Risk and Commodity Currencies (2020). CESifo Working Paper No. 8788, Available at SSRN: https://ssrn.com/abstract=3754679 or http://dx.doi.org/10.2139/ssrn.3754679
Do you have a job opening that you would like to promote on SSRN?
Feedback
Feedback to SSRN
If you need immediate assistance, call 877-SSRNHelp (877 777 6435) in the United States, or +1 212 448 2500 outside of the United States, 8:30AM to 6:00PM U.S. Eastern, Monday - Friday.