Search

Global inflation, which slowly initiated during corona crisis and got fuelled after the Ukrainian war, is a novelty in macroeconomics: never has it happened before that inflation occurred globally, almost with no exception. Before, it generally lead to two main effects: tax revenues increased due to the tax base increase on one hand, and foreign public debt increased by the exchange rate depreciation rate (measured as the percentage increase of the price of Euro). A panel data was used, containing 12 European countries which are not part of the Eurozone & use floating exchange rate regime. Time dimension consisted of monthly data during the period from January 2006 - February 2023. Several models were built to investigate the relation between the exchange rate and the inflation. It is shown that COVID-19 crisis lowered the effect of the inflation on the exchange rates and Ukrainian crisis pressed this effect down even more: while before 2020 a 1% increase in the inflation would cause the exchange rates to depreciate, on average, by 0,86%, in the period of COVID-19 crisis this relation fell down to 0,49%. Finally, since the Ukrainian crisis, a 1 percentage point rise in the inflation level has caused the exchange rates to depreciate by only 0,28 percentage points. This analysis showed that, for the first time in history, the exchange rates are very stable even though inflation globally reached, on average, two-digit rates. This effect is significant since the inflation did not cause the foreign public debt to rise, while at the same time it increased tax revenues, helping the governments of the observed countries to repay their debt. [ABSTRACT FROM AUTHOR]

In recent years the performance of most african capital markets has shown a downward trend, Zambia included. The Lusaka Stock Exchange stock price index performed the worst, dropping 26.83% in local currency by the end of 2016. This study sought to find out the effect of exchange rate on stock market capitalisation. The time sample that was used in this study was a yearly time series that span from 1994 to 2017, thus representing 23 observations from each ZMW/USD exchange rate and market capitalisation. Multiple regression analysis was performed using the Johansen Cointegration test and the Vector Error Correction model (VECM), where market capitalisation was used as the dependent variable while Exchange rate, Inflation rate and GDP were used as the independent variables. All the findings were conducted to test whether F-test statistic hold at 5% level of significance and these were done using E-views, statistical software package. The probability rejection rule of p value < 0.05 indicating relationship between variables, the research results with a probability of 0.0416 and 0.0440 shows that there is a long run relationship between valuables. While the study also found a negative relationship between exchange rate and stock market capitalisation, that the coefficient of - 0.109843 indicates that the stock value decreases by 10.98 percent for any one percent depreciation of the Kwacha against the dollar. Hence, this suggests that the depreciation of the exchange rate negatively affects the performance of the Lusaka Stock market capitalisation. GDP also showed a negative effect of exchange rate on GDP implying that for any one percent depreciation of the currency, GDP decreases by -54.15879. The results for inflation rate also showed a negative relationship between exchange rate and inflation. Inflation rate of -20.7728 showed a negative effect. If the currency depreciates by any one percent change, inflation changes by - 20.7728. Therefore, this study recommends that the bank of Zambia, ministry of finance and mines to adopt policies that can lead to boosting the economy via an increase in productivity so as to ensure an increase in foreign exchange earnings in the country. These policies may include a predictable and non-discriminatory regulatory environment and an absence of undue administrative impediments to business more generally. Hence, ensuring that there is public sector transparency, which may include an impartial system of courts and law enforcement penned at redressing the tax system that could constitute eliminating barriers to attracting more firms to participate in the capital market. Generally, development in financial inclusion in the financial system will encourage both foreign and domestic capital flows. Therefore, the more foreign currency inflows in the country the better will be the performance of the stock market which will ultimately result in an increase of values all shares on the stock market. [ABSTRACT FROM AUTHOR]

Transfer pricing means the price that arises because of the existence of transfer goods, services, and other intangible assets between the companies that have a special relationship or related parties. If the purpose of transferring prices is to meet production needs between companies within the same group, then transfer pricing is carried out neutrally. However, if the goal is to avoid taxes, then the practice is called abuse of transfer pricing. This practice is legal based on regulations but must be following the arm's length principle. This study intends to discover how the simultaneous and partial influence of tax minimization, firm size, exchange rate, and multinationalism on the indication to perform transfer pricing. In this research quantitative methods are used with purposive sampling as a sampling technique. Manufacturing companies listed on the Indonesia Stock Exchange for the year 2016 until 2020 are the population of the study. Based on the sample criteria, the sample companies studied amounted to 14 companies with a period of 5 years. Logistic regression analysis is the analytical technique used in the study through the assistance IBM SPSS Statistics 25 application. According to the results, variables of tax minimization, firm size, exchange rate, and multinationalism simultaneously have a significant influence on the indication to perform transfer pricing. Based on the partial test, multinationalism has a significant positive influence on the indication to perform transfer pricing whereas tax minimization, firm size, and exchange rate do not influence the indication to perform transfer pricing. [ABSTRACT FROM AUTHOR]

Emerging Markets Developing Economies (EMDE) rely on sovereign external debt to meet their financial needs and to enhance the economic growth. However, a high level of external indebtedness and its mismanagement can harm the economic performance, which outlines the importance of the objective of any operation of fund raising. These countries tend to accumulate significant levels of debts. This paper investigates the factors contributing in debt accumulation in case of Morocco, which is an emerging economy, using annual data over the last two decades. A certain determinants of external debt buildup identified by the literature are examined using ARDL approach to cointegration. The findings affirm the relationship between the level of external debt and the explanatory variables both in long and short run. Nevertheless, the nexuses are statistically insignificant. The Granger causality test that was conducted on the model variables reveals a bidirectional cause between external debt and exchange rate. Furthermore, the regulatory quality is the only variable among institutional variables which is caused by foreign borrowing. [ABSTRACT FROM AUTHOR]

Measures taken by states, in the context of epidemiological situation, to reduce the effects of the health crisis have been severe, the most important being stopping non-essential activities, restricting travel and banning travel to and from certain countries and causing shocks in production and distribution chains, but also a sharp contraction in demand for a wide range of goods and services. Given the difficult economic context created by the COVID-19 pandemic, which impacted both the national and global economy, one of the objectives adopted by the Romanian monetary authority in the first half of 2020 was to maintain the stability and liquidity of the banking system for proper functioning of public finance and the real economy. As a state of emergency was declared as of March 16 2020, and considering that the main fiscal response in Romania came from the national budget, the NBR collaborated with the Government in order to avoid a potential conflict between government measures and fiscal measures. One of the unconventional measures "quantitative easing" which involves the basic injection of money into the market in exchange for various financial assets was used by the monetary authorities, including in emerging economies, such as NBR. This paper focuses on the measures and effectiveness of the monetary policy of the national monetary authority in order to reduce the negative effects of the crisis caused by the COVID-19 pandemic. [ABSTRACT FROM AUTHOR]

The present study examined the impact of uncertainty on the exchange rates of currency pairs traded at the Visegrad Group, except the currency of Slovakia. The USD/EUR exchange rate is considered the main influential factor affecting the exchange rates of the currency pairs of Hungary, Czech Republic, and Poland. The study analysed the exchange rates return of these three countries from 1 January 2010 to 31 December 2020. This period covers the announcement and implementation of Brexit; therefore, USD/GBP is considered the second influential factor affecting the exchange rates of the stated currencies. Moreover, the VIX, EMV, and EPU indices are selected as additional uncertainty indicators. The proposed regression model measures the impact of uncertainty on the exchange rates of the selected currencies. It has been discovered that the USD/EUR exchange rate returns significantly influenced the exchange rate returns of the stated currencies during the period under study. In addition, USD/GBP exchange rate returns also had a statistically significant impact on all the currency pairs at the beginning of the analysed period. However, its influence keeps fluctuating throughout the analysed period. The impact of VIX was weak throughout but statistically significant for USD/HUF and USD/PLN exchange rates. On the other hand, the study finds that EMV and EPU indices do not have a pronounced impact on the analysed exchange rate returns. As demonstrated, the uncertainty indices had a relatively higher impact on the development of the observed exchange rate returns. However, the study finds that their impact was often not statistically significant; moreover, the index impacts themselves were quite low. [ABSTRACT FROM AUTHOR]

The economic growth in developed countries, including Southeast Asia, has a significant effect on economic growth in every region. Of these, all of the countries are agreed to cooperate, for instance, ASEAN. The economic sector's cooperation is one type of ASEAN collaboration, such as the movement of capital. It is one of the pillars that has been the precursor of capital market integration in ASEAN countries. It is a financial instrument that trades securities. Thus, the present paper examines the canonical correlation of global capital index, exchange rates and gold price between two ASEAN countries, namely Indonesia and Malaysia. This quantitative study uses secondary data collected from world bank databases and the central bureau of Indonesia's statistics from 2015 to 2019, consisting of 260 samples. The data analyzed using canonical correlation technique. The analysis results found that the global index, exchange rates and commodity prices between Indonesia (IHSG) and Malaysia (KLCI) have significantly correlated. In conclusion, this study successfully proved that the economic growth of one country is associating with others. This study confirmed that global index, exchange rate, and gold price have significantly correlated between Indonesia and Malaysia. [ABSTRACT FROM AUTHOR]

This paper investigates economic forces affecting Japanese stock returns paying particular attentions to economic/structural interpretations of structural shocks behind oil price and exchange rate movements, extending the frameworks of Kilian (2009) and Ready (2018) by including exchange rate variable in their models. The performance of the extended Ready's model is much better than the extended Kilian's model. However, we find economic interpretation of the Ready's empirical framework difficult, because stock returns respond positively to oil price increase due to oil supply shocks and the signs of the impact of exchange rate shocks change in sub samples. Statistical interpretations of two models are rather straightforward: in both models, the residuals of oil price uctuations that cannot be explained by other explanatory variables or structural shocks have positive impacts on Japanese stock returns. They are called oil-market-specific price shocks in Kilian's model and called oil supply shocks in Ready's model, because of their different identification strategies. [ABSTRACT FROM AUTHOR]

The paper analyzes the effects of macroeconomic development on exchange rates and aims to point out indicators with a significant impact on the Visegrad Group's domestic currencies. Steep changes causing the Visegrad Group's currencies to either appreciate or depreciate against the US dollar may result in higher risks for investors and even deteriorate the competitiveness of the particular country. The paper presents several macroeconomic indicators and their influence on four currencies, namely the Czech crown, Hungarian forint, Polish zloty and the Euro. As the Slovak Republic introduced the Euro as its official currency, the paper also analyzes it's impact on the common currency of the Eurozone. To emphasize international competitiveness, the research apart from traditional economic indicators, serving as a focal point in theories for exchange rate determination, incorporated economic complexity and corruption score as well. The findings indicate that during the period between 2000 to 2017, the two common indicators i.e. total reserves and corruption played the key role in determining the yearend spot exchange rates of the Czech crown, Hungarian forint and the Polish zloty. Besides corruption score, economic complexity serves as another significant indicator merely influencing the direction of the Euro's and the Zloty's Dollar exchange rate movement. The last section compares the results of the OLS analyses for each country and verifies their accuracy through robust regressions. Overall, the model for the Czech crown represents the highest accuracy, regarding its predictive ability. [ABSTRACT FROM AUTHOR]

This study examines empirically the relationship between Tourism and Economic Growth of two tourist destinations in the SAARC region namely Sri Lanka and Maldives. The data set was for the period 1998 to 2016 for both countries. Analysis indicated that the variables taken namely Gross Domestic Product(GDP), International Tourist Arrivals (ITA) and US $ Exchange rate (ER) had long run association ship (cointegrated) for both the countries. For the case of Maldives, the Granger Causality test suggested that there is a uni-directional causality running from International Tourist Arrivals to Exchange Rate. For Sri Lanka, Johansen cointegration for the period 1995 to 2016 showed that there is long run equilibrium relationship between tourism and economic growth. The Granger causality test results suggested that there is uni -directional causality from GDP to Tourist Arrivals implying that accepted level of facilities for tourists has not been met, indicating that economic development focusing on enhanced facilities for tourist can attract increased volume of tourists to the country. The Sri Lanka Rupee being a weak currency against the US$ has no influence over tourism. Economic policies must be directed towards enhancing facilities related to tourism in order to attract increased number of tourists to the country. [ABSTRACT FROM AUTHOR]

The interdependence of variables “core inflation” and “the key interest rate” is studied by means of regression modeling. The selected case is related to Russia in 2014-2017. These factors are considered to be dependent and independent variables together with the external parameters of commodity markets and exchange rates. As a result, we have built several models representing change in empirical data, which allow for a better understanding of the monetary policy transmission mechanism. The authors focus on the problem of the best models selection that balances statistical significance and adequacy in the subject field. The best model was chosen by maximizing the adjusted R² value among all models with a given number of predictors, and that value should be sufficiently close to a maximal adjusted R2 value for the total predictor’s set. [ABSTRACT FROM AUTHOR]

International trade is one of the most important issues of macroeconomics. Almost all international trade theories have tried to determine which country produces what, for which price it sells its products to whom. In a number of theories, these inequalities are based on the differences between factor endowment, while in some others they result from technological development or capital accumulation. However, very few theories have revealed that these differences bear the traces of colonial period. Financial liberalization and the spread of international capital movements by the end of colonialism were major developments in the second half of the 20th century. It is no coincidence that these developments occurred simultaneously. The financial revolution has led to a new kind of relationship between capital owner countries and the others. This is a sort of centre-periphery relationship. Those peripheral countries are the ones that have been affected by the hitches of last slowdown of the world economy. Just like Argentina, Turkey has encountered problems such as the higher inflation rate and the inevitable rise in interest rates, following the melting down in currencies in 2018. Again, in the same period, in contrast with the conventional economic views, current account deficit shrank depending not on the increase in exports, but the dramatic decline in imports instead. As a result of all these occurrences, there was a great loss of prosperity in the country. This study investigates whether it is possible for countries depending on the foreign capital like Turkey and Argentina to follow an independent policy from the fluctuations in the economic conjuncture or not. Is it possible to develop permanent policies that will eliminate dependency on foreign capital, instead of familiar ones such as targeting in inflation, exchange rate or current account deficit? Which has a higher cost? To develop and implement these policies, or to sway in every wind? [ABSTRACT FROM AUTHOR]

The exchange regime plays an important role in the orientations of the choice of economic policies. In 2018, Morocco started a reform aiming to move gradually from the current fixed exchange regime to a more flexible regime to increase the competitiveness of the economy and its resilience to the external shocks. this paper investigate the potential impact of such a reform by using the input output model to estimate the imported content of final demand and simulating the impact of exchange variations on the prices of these components i.e. final consumption, investment and export. The main finding is that that a 10% depreciation will higher significantly the prices of final demand component. Thus, a depreciation of the Moroccan dirham will have a harmful effect on the economy by increasing by causing a decrease of the competiveness in the international market of the Moroccan products and generating inflationary pressure in the local economy. [ABSTRACT FROM AUTHOR]

The extremely intention of this manuscript is to analyze the correlation between gold price and Rupee -- Dollar exchange rate in India. For the purpose of study monthly time series data of above mentioned variables have been studied covering the period of nine years from January, 2009 to December, 2017. In order to examine relationship among these variables Unit Root test and Co-integration test will be applied; 2 statistical software packages. The result shows that there exists a long run co integrating relation between the variables. That is we can stabilize the Gold Price movement by controlling the exchange rate fluctuations. Likewise it also shows that Exchange rate doesn't Granger cause to Gold price and vice versa. It means that the time series data of one variable cannot be used to predict another. [ABSTRACT FROM AUTHOR]

In this paper, the impact of uncertainty of exchange rate on Iran's pistachio export demand was investigated . We estimate conditional variance (that is equivalent to uncertainty) For each of importing countries With GARCH model. Panel data were used to estimate the export demand function of Iran's pistachio nuts to Eight Main Importing countries for the period of 1992 to 2015 so that the relationship between factors affecting Iran's pistachio exports can be examined. The results show the existence of long-run relationships among the variables that have a significant impact on Iran's pistachio exports. The empirical results indicate that uncertainty of exchange rate had a statistically significant negative impact (-0.24881) on the import demand of those countries. [ABSTRACT FROM AUTHOR]

The aim of this study consists in analyzing the importance of the exchange rate forecast using the Box-Jenkins models, also known as Auto Regressive Integrated Moving Average (ARIMA) models. The first part of the paper presents the main research in this field, which can be classified in two categories (studies applying classical methods, such as Box-Jenkins models and studies which rely on sophisticated prediction tools), and summarizes the main findings of some of the studies applying Box-Jenkins models. In the second part of the paper we performed a EUR/RON exchange rate analysis and forecasting, based on testing several AR, MA and ARMA candidate processes, in order to find out the best fitting model specification. We adopted the following strategy: i) an initial time series had been used for testing various model specifications, identify the best performing one and making a forecast of the EUR/RON exchange rate; ii) after comparing the accuracy of this forecast with the real level recorded by the exchange rate at end of May 2018, we conducted a second forecast, for the period September 2018 - March 2019. The initial time series employed has daily frequency and covers the timeframe July 4, 2005 - December 5, 2017, while the second time series used covers the period July 4, 2005 - August 31, 2018. The empirical findings have passed the goodness-of-fit tests and show a good predictive power. The first forecast performed for a six month period (December 2017 - May 2018) has indicated a slow pace, persistent increase of the EUR/RON exchange rate, which was confirmed by the expectations of market participants (financial analysts, banks' research departments). The second forecast, which covers the last quarter of 2018 and the first quarter of 2019, indicates a similar slow-pace rising trend. [ABSTRACT FROM AUTHOR]

Global economic has been decreasing in the recent years, manifested by the greater exchange rates volatility on international commodity market. This study attempts to analyze some prominent exchange rate forecasting models on Malaysian commodity trading: univariate ARIMA, ARCH and GARCH models in conjunction with stationarity test on residual diagnosis direct testing of heteroskedasticity. All forecasting models utilized the monthly data from 1990 to 2015. Given a total of 312 observations, the data used to forecast both short-term and long-term exchange rate. The forecasting power statistics suggested that the forecasting performance of ARIMA (1, 1, 1) model is more efficient than the ARCH (1) and GARCH (1, 1) models. For ex-post forecast, exchange rate was increased from RM 3.50 per USD in January 2015 to RM 4.47 per USD in December 2015 based on the baseline data. For short-term ex-ante forecast, the analysis results indicate a decrease in exchange rate on 2016 June (RM 4.27 per USD) as compared with 2015 December. A more appropriate forecasting method of exchange rate is vital to aid the decision-making process and planning on the sustainable commodities' production in the world economy. [ABSTRACT FROM AUTHOR]

This paper presents the traditional types of exchange rate risk faced by firms and some of principal methods of exchange risk management that a company which make foreign currency operations can use. Foreign currency risk management involves both assessing the risk faced by the companies and adopting measures for the risk hedging or reduce the damage it may cause. The damages result from the company's unfavorable difference between the exchange rates of the currencies in which the transactions are made. [ABSTRACT FROM AUTHOR]

Copyright of Topical Issues of Tourism: Tourism & Its Impacts on Society is the property of College of Polytechnics Jihlava and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The number of visitors of the Czech Republic has been increasing over the last few years and this trend may have several explanations related to both internal as well as external environment factors. In this paper, we have specifically focused on an identification of various exchange rates' influence on the number of visitors of the Czech Republic. We have analysed monthly data about nominal exchange rates between CZK and all other, from tourism perspective, important currencies from 2011 to 2016. Several common patterns have been found and influence of the exchange rates on the number of visitors has been calculated while compensating for seasonality, hotel price index, exchange rate autocorrelation and safety. The applied method of linear modelling can be successfully used both for the prediction of number of visitors incoming from different source markets and analysis of impact of various promotion activities aiming at them. [ABSTRACT FROM AUTHOR]

The paper compares theoretical impulse response functions from a DSGE model for a small open economy with an empirical VAR model estimated for the Croatian economy. The theoretical model fits the data well as long as monetary policy is modelled as a fixed exchange rate regime. The paper considers only a foreign output gap shock. A positive foreign shock increases domestic GDP and prices and decreases terms of trade, which is in compliance with theoretical assumptions. Interest rates behave differently than suggested by the estimated DSGE model, which could be explained with an unconventional interest rate transmission channel in Croatia. [ABSTRACT FROM AUTHOR]

The paper compares theoretical impulse response functions from a DSGE model for a small open economy with an empirical VAR model estimated for the Croatian economy. The paper analyses the impact of productivity shock on the following variables: output gap, interest rate, CPI inflation and terms of trade. Impulse responses from the empirical VAR model do not resemble those from the theoretical model for in any proposed monetary regimes. Results of modelling simultaneous interrelationships between variables support conclusion that productivity shocks do not play a significant role in determining the variation of selected macroeconomic variables in the case of Croatia. [ABSTRACT FROM AUTHOR]

We study the exchange rate behavior, mainly as to the presence of asymmetry in the shocks to conditional variance. Particularly, we investigate if the presence of that asymmetric response is specific to a marked behavior of the currency, appreciation/Dutch disease/depreciation, and if it appears masked when taking long non-homogeneous periods. Taking Mozambique Metical bilateral exchange rate against South Africa Rand, a major trading partner, we identify specific movements in defined sub-periods, where the most recent has the Dutch disease under scrutiny. Our results point out that asymmetry emerges especially when the currency is depreciating, while it is masked when considering larger periods that combine differences in currency behavior. [ABSTRACT FROM AUTHOR]

In this study, after a brief literature review, the RON / EURO exchange rate time series over the 03.01.2005 - 05.02.2015 time period is analyzed. After checking the stationarity of the data - ARCH, GARCH, EGARCH and TARCH models will be developed and compared. Next the best model is chosen and the serial correlation and the Jarque-Bera test are further analyzed with various conclusions being drawn. [ABSTRACT FROM AUTHOR]

The article generally analyses the causes leading up to the foreign exchange intervention by the Czech National Bank in November 2013 and its consequences. It explains the reasons for further easing monetary policy and for choosing the exchange rate instrument and its specific level. The article examines the use of exchange rate by the Czech National Bank as a monetary policy instrument at the zero lower bound on interest rates and discusses its expected benefits in the case of the Czech Republic. The most interesting aspects of the Czech National Bank's experience include the debate on how to use the exchange rate as a monetary policy instrument at the zero lower bound and on how transparent it should be. This debate eventually resulted in the choice of a publicly declared, one-sided exchange rate commitment. The use of foreign exchange interventions to ease monetary conditions in an open economy is a rational choice. This monetary instrument is used only when interest rates are at a zero level, i.e., when the standard natural tool is no longer available. The pass through at the zero lower bound is significantly higher than that assumed on the basis of past experience during normal times. The depreciation helps net exports, which is a good side-effect stimulating the economy. The power of the central bank when intervening against its own currency is not limited by the volume of reserves. In essence, in an economy with abundant liquidity in the banking sector, such as the Czech Republic, foreign exchange interventions are the most efficient way to implement quantitative easing. The article has a nature of applied research focused on the field of monetary policy. The subject of research is the foreign exchange intervention by the Czech National Bank. The article contains analytical views of various unconventional monetary policy measures and formulates synthetic viewpoints based on multi-criteria exploration. [ABSTRACT FROM AUTHOR]

The aim of this paper is to evaluate the impact of CZK/PLN development on trade flows between the Czech Republic and Poland in the context of disaggregated data on product-level trade balances. The dataset used in this study covers period from 1999 to 2014. We consider selected product categories determined on the basis of SITC classification. We employ the Johansen cointegration test to analyze the long term relationship and a vector error correction model to explore the short term effects of CZK/PLN exchange rate level. Our findings suggest that total bilateral trade balances and most of product groups are related with exchange rate in the long term. The commodity-level results are ambiguous and can not be generalized across different product categories. [ABSTRACT FROM AUTHOR]

This study aims to show how similar economic regional integration brought different impact on exports caused by exchange rate variation, and the larger asymmetry observed after regional integration. Bulgaria, Croatia, Czech Republic, Hungary, Poland and Romania are the countries observed in the EU, while the whole Mercosul is taken into account. The economic region and the related intra-group commerce becomes a buffer to exchange rate fluctuation, less sensible to currency appreciation. The proximity to first world countries seems to be an important advantage when comparing the same results with Mercosul, a region comprised only of developing countries. A GMM panel data model was used to estimate the responses of exports caused by exchange rate shocks, using data from several international institutions such as: UN's Comtrade for international commerce and the IMF and World Bank for GDP data and exchange rates. [ABSTRACT FROM AUTHOR]

The relationship between real exchange rate and trade balances are documented in many theories. One of the theories is the so-called Marshall-Lerner condition. In this study, we seek to test for the validity of Marshall-Lerner hypothesis, i.e. to reveal if the depreciation of real exchange rate leads to the improvement in trade balances. We focus our study in ASEAN-5 countries and their main trade partners of U.S., Japan and China. The dynamic panel data of pooled mean group (PMG) approach is used to detect the Marshall-Lerner hypothesis among ASEAN-5, between ASEAN-5 and U.S., between ASEAN-5 and Japan and between ASEAN-5 and China respectively. The estimation is based on the autoregressive Distributed Lag or ARDL model for the period of 1970-2012. The paper concludes that Marshal Lerner theory does not hold in bilateral trades in four groups of countries. The trade balances of ASEAN5 are mainly determined by the domestic income level and foreign production cost. [ABSTRACT FROM AUTHOR]

Recently, statistician emphasized on the fitting of finite mixture model by using maximum likelihood estimation as it provides asymptotic properties. In addition, it shows consistency properties as the sample sizes increases to infinity. This illustrated that maximum likelihood estimation is an unbiased estimator. Moreover, the estimate parameters obtained from the application of maximum likelihood estimation have smallest variance as compared to others statistical method as the sample sizes increases. Thus, maximum likelihood estimation is adopted in this paper to fit the two-component mixture model in order to explore the relationship between rubber price and exchange rate for Malaysia, Thailand, Philippines and Indonesia. Results described that there is a negative effect among rubber price and exchange rate for all selected countries. [ABSTRACT FROM AUTHOR]

The paper examines the use of artificial neural network for EUR\CZK currency pair prediction. The article is focused on the benefit that a company can get using ANN model in decision making process while exchanging EUR\CZK according to its import/export profile. ANN model is based on fundaments of technical analysis and uses time-series values OHLC as input. The results of research showed that the ANN model can help companies to save their revenues or lower the loss created in timing of exchange currencies. The analysis was realized taking into account the period of historical prices from 14.1.2013 to 19.3.2014. [ABSTRACT FROM AUTHOR]

Influence of globalization permeates all areas of human activity, it is the matter of technology and human knowledge transfers. Thus it is obvious, that European Union's membership enables rapid development of merger states. Under the economic activities of companies in the international environment, exchange of goods and services becomes an integral part of their economic life and brings necessity for the proper measurement of imported assets, as their value will have a subsequent impact on the reported financial position and performance of the company. This paper deals with the initial inventory measurement. The first part of the contribution is a literature search on the topic and reviewing the current level of knowledge of the issue. The second part of the paper brings a comparative analysis of selected impacts on the inventory measurement and it is primarily addressed to the impact of the chosen methodology of the currency rate's conversion in Czech legislative conditions - in this case the Czech crown and Euro - when the inventory (namely merchandise) is imported. This problem is illustrated in a case study of an existing merchandising company; current methodology used by the firm is compared with other options, results are discussed from their impact on financial reporting point of view. Secondarily, the issues of transportation costs as a component of the acquisition cost in the appointed company are discussed. [ABSTRACT FROM AUTHOR]

Over the past two decades, the European Union (EU) has been holding its position in the world market competing with the USA and Japan, as well as with new rivals such as China and India. However, even before the crisis, the growth in productivity had been slowing down and the internal and external balance was endangered by the different economic structures of the member states. The EU faced the serious challenges of losing world market positions due to a loss of competitiveness. This chapter aims to point out the risks of reducing EU competitiveness by analyzing the indicators of price and cost competitiveness, as well as the structural and technological aspects of competitiveness. Focus is placed on the influence of the world crisis on the competitiveness and export performances of the EU in order to show to what extent the global downturn may have aggravated previously existing needs for the readjustment of the functioning of the Union. Not only has the crisis demonstrated that the problems in the Union had been not created recently, but also that there were urgent demands for new and improved policies in order to regain the strength of competitiveness and performance. The reformulated strategy needs to be based on openness and innovation, with investment in research and development. Long-term expectations are to be made to comprehensive structural changes in order to overcome structural differences between individual Member States and to increase overall competitiveness. Additionally, trade barriers between individual Member States must be removed if higher individual and aggregate rates of economic growth are to be achieved. It is clear that the effects of a deeper integration of the EU have not yet been achieved, and any expected benefits may not be realized, if the internal and external balance of the Union is not maintained. [ABSTRACT FROM AUTHOR]

Recent studies have shown the classification and prediction power of the Neural Networks. It has been demonstrated that a NN can approximate any continuous function. Neural networks have been successfully used for forecasting of financial data series. The classical methods used for time series prediction like Box-Jenkins or ARIMA assumes that there is a linear relationship between inputs and outputs. Neural Networks have the advantage that can approximate nonlinear functions. In this paper we compared the performances of different feed forward and recurrent neural networks and training algorithms for predicting the exchange rate EUR/RON and USD/RON. We used data series with daily exchange rates starting from 2005 until 2013. [ABSTRACT FROM AUTHOR]

The aim of this paper is to investigate the effect of exchange rate volatility on bilateral trade flows between the Czech Republic and its major trading partners. For this purpose we employ extended trade gravity model approach. Trade volume between a pair of countries is modeled as an increasing function of their sizes (GDP) and a decreasing function of the distance between the two countries. Additional factors included in extended model are population, dummies for common border; membership in EU and proxy for exchange rate volatility. Generally is expected that increased exchange rate volatility increases the risk of exporters and reduces foreign trade. This paper explores relationship between trade and exchange rate volatility using quarterly data over the period 1997:1 - 2012:2. In order to obtain the objective result, we use the panel data regression with 17 trading partners. Based on a gravity model that controls for other factors likely to determine bilateral trade, the results suggest that nominal exchange rate volatility of Czech koruna has a significant negative effect on bilateral trade over the sample period. [ABSTRACT FROM AUTHOR]

The aim of this paper is to examine the effect of oil price development on the selected securities traded in the Prague Stock Exchange. Although, there are many studies, which examine the impact of oil price, most of these studies focused on Western markets or important and large emerging markets. The Czech Republic belongs rather to the marginal countries in terms of economic significance. Further, the PSE is characterized by several specific features. The applied models are based on the linear dependence between an equity risk premium and the systematic risk and the development of oil price. The influence of the oil price development is examined from two perspectives. First, the impact of oil prices was analyzed without any decomposition. Afterwards, the oil prices in USD and the exchange rate were examined separately. It was found out that the exchange rate has a more significant impact on the equity excess return than the price of oil. Further, the effect of demand and supply shocks of oil was analyzed. The results confirmed with the exception of NWR, that the demand shocks are a significant price factors for the examined stocks. In the case of NWR supply shocks were significant for the price process as well. [ABSTRACT FROM AUTHOR]

Exchange rate is an important link of international economic relations. In this paper, a novel method for improving flexible neural tree is proposed to forecasting exchange rate data. The hybrid flexible neural tree with pre-defined instruction sets can be created and evolved. The structure and parameters of hybrid flexible neural tree is optimized using probabilistic incremental program evolution and particle swarm optimization algorithm. Compared with the conventional artificial neural network and flexible neural tree based on gene expression programming, the experimental results indicate that the proposed method is feasible and efficient. [ABSTRACT FROM PUBLISHER]

Jointly consider the demand risk and exchange rate risk of the global supply chain. With a Two-echelon Supply Chain under global environment for modeling background, this paper establishes a dynamic game model about manufacturer and retailer, gains the results of the equilibrium, studies how the uncertainty of the exchange rate and exogenous demand influence the manufacturer's original wholesale price , incentive degree, the retailer's order quantity and exchange rate risk hedge strategy. The results show that the manufacturer's original wholesale price and the incentive degree are unaffected by exchange rate and demand exogenous fluctuation. The retailer's order quantity is unaffected by exchange rate exogenous fluctuation, but decreases with an increase in the demand exogenous fluctuation. The retailer's exchange rate risk exposure proportion decreases with an increase in the exchange rate exogenous fluctuation, and increases with an increase in the demand exogenous fluctuation. The results indicate that the retailer's exchange rate risk hedge strategy can stabilize the supply chain operation strategy. [ABSTRACT FROM PUBLISHER]

This paper aims to fill the gap in existing literature and provide direct empirical evidence on how exchange rates are connected to macroeconomic fundamental variables in ten EU new member states from Central and Eastern Europe. We use cross-correlation on cyclically filtered and seasonally adjusted time series over the period 1998-2010. In average, we found the cyclical properties of exchange rates and other variables as weakly correlated. However, substantial differences among countries and variables were revealed. The only common feature is a generally higher correlation of macroeconomic aggregates with nominal than real effective exchange rate. The results also suggest that the correlation between exchange rate and net export is more pronounced in less open and relatively poorer countries. [ABSTRACT FROM AUTHOR]

In this paper, the authors discuss several controversial issues about exchange rate forecasting by using neural network, which include whether the type of data sample and the size of it will affect the prediction accuracy, whether time-series model or neural network model is more suitable for exchange rate forecasting, and whether neural network suitable for long-term prediction or short-term prediction. The techniques that the authors applied are BP-neural network model in Matlab and timeseries model in Excel. Some beneficial results are indicated from this study, for example, the type of data sample has little effect on the prediction accuracy in exchange rate forecasting by neural network. [ABSTRACT FROM AUTHOR]

In this work, we propose an adaptive Monte Carlo (MC) simulation technique to compute the sample paths for the dynamical asset price. In contrast to conventional MC simulation with constant drift and volatility (μ,σ), our MC simulation is performed with variable coefficient methods for (μ,σ) in the solution scheme, where the explored dynamic asset pricing model starts from the formulation of geometric Brownian motion. With the method of simultaneously updated (μ,σ), more than 5,000 runs of MC simulation are performed to fulfills basic accuracy of the large-scale computation and suppresses statistical variance. Daily changes of stock market index in Taiwan and Japan are investigated and analyzed. © 2007 American Institute of Physics [ABSTRACT FROM AUTHOR]

Recent empirical papers point to the relevance of outsourcing and offshoring for the transmission of business cycle shocks and thereby for the conduct of monetary policy. This is especially true for the countries that are about to join the euro, who have to stay for two years in the European Exchange Rate Mechanism (ERM 2) and therefore target inflation and the exchange rate simultaneously. These countries are significantly integrated with third countries through the production chain. How do external shocks originating from a third country affect monetary policy under ERM 2? We analyze a third-country technology shock. Our results show that a Taylor rule extended for an exchange rate term is a good simple rule for production sharing via complements as well as substitutes vis-à-vis the third country. Nevertheless, the costs of ERM 2 in terms of a traditional central bank loss function are considerable. [ABSTRACT FROM AUTHOR]

This paper uses firm-level data from 1986 to 2007 to examine the effects of cross-border shopping on retailer performance. We used detailed geographic information to assess the degree to which these effects are influenced by the location of the retailer (i.e., distance to the closest land border post). We also investigate the role of other firm level characteristics. Previous studies have established that such border-crossing trips between Canada and the US are strongly related to changes in relative prices induced by exchange rate movements. This suggests the potential of significant demand fluctuations facing Canadian retailers induces by exchange rate changes. We develop a model of retailers with heterogeneous firms and traveling consumers. Based on the model, we construct a measure of sensitivity of consumer travel/stay decision to exchange rate movements. We use it as an indicator of retailer exposure to cross-border shopping and quantify the exposure measure for Canadian cities with different proximities to the border under selected levels of the exchange rate. Guided by the model, we also assess the impact of traveling consumers on retailer performance empirically. [ABSTRACT FROM AUTHOR]

Our aim is to examine the important determinants of inflation in Turkey. For this purpose, we use monthly time series data (1983 to 2010) by applying the autoregressive distributed lag (ARDL) approach. The advantage of the ARDL approach is that while other co-integration techniques require all of the regressors to be integrated of the same order, ARDL can be applied irrespective of their order of integration. Thus, it avoids the pretesting problems associated with standard cointegration tests. Moreover, with the ARDL, it is possible that different variables have differing optimal numbers of lags, while in traditional models this is not possible. Although inflation has decreased low levels for 5 years in Turkey, it is not stable and acceptable levels. And before this process Turkish economy has had dread inflation experiences. We construct an empirical model to understand the reasons of inflation in Turkey. In our empirical model we will investigate effects of liquidity, the exchange rate, GDP, budget deficit, the expected rate of inflation and imported inflation on inflation. [ABSTRACT FROM AUTHOR]