Exchange Rate Pass-Through in Brazil

Author/Editor:

Agnes A Belaisch

Publication Date:

July 1, 2003

Electronic Access:

Free Full text (PDF file size is 501 KB).Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

In the last two years the real has undergone a large depreciation and the central bank has missed its inflation target in 2002 for the second year in a row. Inflation, however, has increased much less than the rate of currency depreciation and the pickup in inflation in the last quarter of 2002 raises the question of whether the exchange rate passthrough has finally risen. This paper argues that the passthrough in Brazil has fallen compared with estimates in other studies on earlier time periods, and remains low when compared with the passthrough in other Latin American countries. Indeed the passthrough is more comparable with that of G-7 countries—although in Brazil the effect on prices appears to be faster.

Series:

Working Paper No. 03/141

Subject:

English

Publication Date:

July 1, 2003

ISBN/ISSN:

9781451856200/1018-5941

Stock No:

WPIEA1412003

Price:

$15.00 (Academic Rate:$15.00)

Format:

Paper

Pages:

19

Please address any questions about this title to publications@imf.org