Will the Emergence of the Euro Affect World Commodity Prices?

32 Pages Posted: 14 Feb 2006

See all articles by John T. Cuddington

John T. Cuddington

Colorado School of Mines

Hong Liang

International Monetary Fund (IMF)

Multiple version iconThere are 2 versions of this paper

Date Written: December 2000

Abstract

This study provides evidence that episodes of internal stability of exchange rates among the 11 Euro countries during 1957-98 were associated with periods of lower real commodity price volatility. These stabilizing effects are statistically significant for fertilizer, metals, petroleum, and cereals. A reasonable inference, therefore, is that the establishment of the Euro on January 1, 1999, should be expected to contribute to reduced volatility of world commodity prices, other things equal, although the impacts are likely to be modest.

Keywords: Commodity prices, volatility, exchange rate regimes, Euro

JEL Classification: F33, O13, F41

Suggested Citation

Cuddington, John T. and Liang, Hong, Will the Emergence of the Euro Affect World Commodity Prices? (December 2000). IMF Working Paper, Vol. , pp. 1-32, 2000. Available at SSRN: https://ssrn.com/abstract=880866

John T. Cuddington (Contact Author)

Colorado School of Mines ( email )

1500 Illinois St.
Golden, CO 80401
United States
303-273-3150 (Phone)

HOME PAGE: http://www.mines.edu/~jcudding

Hong Liang

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

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