Exchange Rate Assessment for Oil Exporters

Author/Editor:

Klaus-Stefan Enders

Publication Date:

April 1, 2009

Electronic Access:

Download PDF. 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:

While the underlying methodologies continue to be widely debated and refined, there is little consensus on how to assess the equilibrium exchange rate of economies dominated by production of finite natural resources such as the oil economies of the Middle East. In part this is due to the importance of intertemporal aspects (as the real exchange rate may affect the optimal/equitable rate of transformation of finite resource wealth into financial assets), as well as risk considerations given the relatively high volatility of commodity prices. The paper illustrates some important peculiarities of the exchange rate assessment for such natural resource producers by working through a simple two-period model that captures certain key aspects of many resource economies.

Series:

Working Paper No. 09/81

Subject:

Frequency:

Monthly

English

Publication Date:

April 1, 2009

ISBN/ISSN:

9781451872286/1018-5941

Stock No:

WPIEA2009081

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

21

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