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Exchange Rate Regime Considerations for Jordan and Lebanon
Author:
Ms. Rina Bhattacharya
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Series:
IMF Working Papers
Volume/Issue:
Volume 2003: Issue 137
Language:
English
Publication Date:
01 Jun 2003
DOI:
https://doi.org/10.5089/9781451855937.001
ISBN:
9781451855937
ISSN:
1018-5941
Pages:
42
Keywords:
WP; exchange rate; Jordan; Lebanon; exchange rate regime; optimum currency area; nominal anchor; money demand demand shock; trading partner country; rate of return; Lebanese pound; exchange rate peg; case of Jordan; exchange rate instrument; exchange rate depreciation; Jordanian dinar; money demand disturbance; Exchange rate arrangements; Exchange rate flexibility; Conventional peg; Exports; Exchange rates; Middle East
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper addresses the issue of the appropriate exchange rate regimes for Jordan and Lebanon in the context of the literature on optimum currency areas and the arguments concerning the use of the exchange rate as a nominal anchor for the economy. It presents some empirical results on the nature of output shocks in Jordan and Lebanon in the recent past, on the price sensitivity of exports from Jordan, and on currency and asset substitution in both countries. It does not directly address the issue of whether the current exchange rate in either country is overvalued or not, nor does it discuss the issue of an appropriate exit strategy from the current peg.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund