The IMF Updates the Effective Exchange Rates Indices

IMF News, March 26, 2019

Source details

On February 26, 2019, the International Monetary Fund (IMF) published revised indices of nominal and real effective exchange rates (EER).
Indices released in the International Financial Statistics reflect an update of the underlying trade-based weights and other methodological refinements.
The revision benefited from consultations with selected stakeholders, including the Bank for International Settlements and the European Central Bank.

Previously based on fixed-base weights from 2004–06; the new indices use weights updated every three years starting in January 2004.
New weights have been computed for 2007–09, 2010–12, and 2013–15; revised weights for 2004–06 have also been calculated to incorporate changes in the source data.
Weights are calculated as three-year averages of annual data available from official sources on merchandise trade, tourism, and manufacturing collected from:
- United Nations
- Organisation for Economic Co-operation and Development
- World Bank
- World Tourism Organization
- United Nations Industrial Development Organization

Inclusion threshold for partner countries changed from 1 percent to 0.45 percent (trade-based weight).
Pool of countries included in the new index calculation increased from 19 to 31.

New weights applied to corresponding three-year periods (example: 2004–06 weights from January 2004 to December 2006; 2007–09 weights from January 2007 to December 2009; etc.).
A chained methodology is used, with the new series recalculated starting from January 2004.
Prior to 2004, the old fixed-base indices are spliced to the new chained indices, with December used as the splicing period to link the weights.

The new methodology is described in Bayoumi et al. (2005), New Rates from New Weights, IMF Working paper 05/99.
The weights underlying the effective exchange rate indices are available upon request; queries should be emailed to STA-EERWeights@imf.org.

Press Release No. 16/93 — March 26, 2019; IMF Communications Department, MEDIA RELATIONS, PRESS OFFICER: Pemba Sherpa