To What Extent Does Productivity Drive the Dollar?
6 Pages Posted: 26 Apr 2005
Date Written: August 2001
The continuing strength of the dollar has fueled interest in the relationship between productivity and exchange rates. An analysis of the link between the dollar's movements and productivity developments in the United States, Japan, and the euro area suggests that productivity can account for much of the change in the external value of the dollar over the past three decades.
Keywords: productivity, exchange rate
JEL Classification: F31, F41
Suggested Citation: Suggested Citation