## Estimating Iceland’s Real Equilibrium Exchange Rate

_IMF Working Papers, December 1, 2007_

## Source details

**Canonical URL:** [Estimating Iceland’s Real Equilibrium Exchange Rate](https://www.imf.org/en/publications/wp/issues/2016/12/31/estimating-icelands-real-equilibrium-exchange-rate-21466)

## Other formats

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## Bibliographic details
- Authors: Robert Tchaidze
- Published: December 1, 2007
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451868395.001

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### Summary
- Given recent developments in Iceland, this paper evaluates its real exchange rate disequilibrium.
- The paper discusses three approaches to estimating the equilibrium values.
- The paper suggests that the adjustment needed to bring the real exchange rate in line with fundamentals is in the range of 15-25 percent, although timing and manner of this adjustment is unclear.

### Approaches to estimating equilibrium values
- The paper discusses three approaches to estimating the equilibrium real exchange rate.
- No further methodological details are provided on the landing page.

### Key findings and projections
- Adjustment needed to align the real exchange rate with fundamentals: in the range of 15-25 percent.
- Timing and manner of the adjustment: unclear.

### Subjects and keywords
- Subject: Current account, Current account deficits, Real effective exchange rates, Real exchange rates, Trade balance
- Keywords: GDP, REER, WP

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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/estimating-icelands-real-equilibrium-exchange-rate-21466_