Exchange Rate Regime Considerations for Jordan and Lebanon
IMF Working Papers, June 1, 2003
Source details
- Canonical URL
- Exchange Rate Regime Considerations for Jordan and Lebanon
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Bibliographic details
- Authors: Rina Bhattacharya
- Published: June 1, 2003
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451855937.001
Summary
- Addresses appropriate exchange rate regimes for Jordan and Lebanon within the literature on optimum currency areas and the use of the exchange rate as a nominal anchor.
- Presents empirical results on:
- the nature of output shocks in Jordan and Lebanon in the recent past,
- the price sensitivity of exports from Jordan,
- currency and asset substitution in both countries.
- Explicit exclusions:
- Does not address whether the current exchange rate in either country is overvalued or not.
- Does not discuss an appropriate exit strategy from the current peg.
Empirical analysis and findings (as presented)
- Nature of output shocks:
- Empirical results are presented on the types and properties of output shocks affecting Jordan and Lebanon in the recent past.
- Price sensitivity of Jordanian exports:
- Empirical results are presented on the price sensitivity of exports from Jordan.
- Currency and asset substitution:
- Empirical results are presented on currency and asset substitution in both Jordan and Lebanon.
Theoretical and policy context
- Frameworks and concepts used:
- Optimum currency areas.
- Exchange rate as a nominal anchor for the economy.
- Policy questions considered:
- Appropriate exchange rate arrangements and flexibility for Jordan and Lebanon.
- Implications of empirical findings for exchange rate regime choice.
- Policy questions explicitly not covered:
- Overvaluation status of current exchange rates.
- Exit strategies from existing pegs.
Content in this bundle
- Exchange Rate Regime considerations for Jordan and Lebanon - WP/03/137