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106787

Determinants of Real Exchange Rate Evidence: from Egypt

Article

Last updated: 25 Dec 2024

Subjects

-

Tags

التنمية الاقتصادية

Abstract

In November 2016, the Central Bank of Egypt (CBE) had announced the adoption of a floating exchange rate regime. Determining the equilibrium exchange rate is a chronic problem in the Egyptian economy, this means that the exchange rate is determined according to several variables. So, this research comes to examine the determinants of the exchange rate dealing with money supply, trade openness, and foreign exchange reserves. This research uses time-series data from 1990 to 2018 and depends on the method of co-integration (Autoregressive Distributed Lag Model, ARDL) through which the relationship is estimated in the long run, and depends on the Error Correction Mechanism (ECM) method to estimate the relationship in the short run, and the model is applied through the statistical program EViews. Besides using the descriptive method to view and analyze the exchange rate problem, the variables, and interpretation of the results.
This study revealed that foreign exchange reserves and broad money have a significant and positive impact on the real exchange rate in the long-run, as well as trade openness and foreign exchange reserves have a significant impact and positively related to the real exchange rate in the short-run. The study also found, If the real exchange rate is deformed, it will need about 21 months to return to equilibrium.

DOI

10.21608/jocu.2020.37917.1041

Keywords

Real Exchange Rate, Money supply, Trade Openness, Foreign Exchange Reserves, Egypt

Authors

First Name

Mohamed

Last Name

Abdelgany

MiddleName

-

Affiliation

کلية سياسة واقتصاد

Email

mfathy@eps.bsu.edu.eg

City

بنی سویف

Orcid

-

Volume

7

Article Issue

العدد (6) ابریل 2020

Related Issue

13768

Issue Date

2020-04-01

Receive Date

2020-06-04

Publish Date

2020-04-01

Page Start

1

Page End

22

Print ISSN

2636-4166

Online ISSN

2735-3176

Link

https://jocu.journals.ekb.eg/article_106787.html

Detail API

https://jocu.journals.ekb.eg/service?article_code=106787

Order

1

Type

مقالات سیاسیة واقتصادیة

Type Code

1,296

Publication Type

Journal

Publication Title

مجلة السياسة والاقتصاد

Publication Link

https://jocu.journals.ekb.eg/

MainTitle

Determinants of Real Exchange Rate Evidence: from Egypt

Details

Type

Article

Created At

22 Jan 2023