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#### WEO Data Forum > about World growth based on market exchange rates

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ykyk about World growth based on market exchange rates
I want to ask you how to work out "World growth based on market exchange rates"?
9/3/2008 1:37:40 AM
WEOModerator Re : about World growth based on market exchange rates
Thank you for your question. The way we aggregate real GDP growth rates using market exchange rates for the world is to do a weighted average of real GDP growth for individual countries using nominal GDP converted into U.S. dollars using current market exchange rates as the weights. Below is the step-by-step procedure.

1. Convert nominal GDP into U.S. dollars by using the current market exchange rate for a given year for all countries in the sample. (series 1)
2. Create a world nominal GDP by summing up series 1 across all countries. (series 2)
3. Take the ratio of series 1 and series 2 to calculate the share or weight of an individual country relative to the whole world in each year. (series 3)
4. Calculate the 3-year centered moving average of series 3. (series 4)
5. For a given year, do a weighted average of real GDP growth for the individual countries in the sample using series 4 as the country weights. In other words in each year, do [Sum of (real GDP growth * weight)] / (Sum of all weights).

I hope this helps. Let us know if you need more clarification.

Best,
Angela
9/5/2008 2:34:25 PM
ykyk Re : about World growth based on market exchange rates
I want to ask you some more detail.

1) I think "Series 1 and 2" data can get from "World Economic Outlook Databases" which we can access from your HP. Is it right or not?

2) If I calculate "series 4" for myself, I must do the follow.
[the weight of 2007 ] = AVERAGE[the weight of 2006 ,2007,2008]
Is it right or not?

Thank you
9/8/2008 1:20:15 AM
WEOModerator Re : about World growth based on market exchange rates