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Is Asia Responsible For Exchange Rate Misalignments Within The G20?

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  • Agnès Bénassy‐Quéré
  • Amina Lahrèche‐Révil
  • Valérie Mignon

Abstract

. We use a panel data methodology to derive a consistent set of both real effective and bilateral exchange rate misalignments for the G20 currencies. As far as Asia is concerned, two conclusions can be drawn. First, according to our estimations, the five Asian countries in the sample had strongly undervalued currencies at the beginning of 2006. Second, a lack of exchange rate adjustment in Asia has limited impact on other misalignments against the US dollar. Indeed, bilateral misalignments between the USA and any other country mainly depend on real effective misalignments of both countries.

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  • Agnès Bénassy‐Quéré & Amina Lahrèche‐Révil & Valérie Mignon, 2008. "Is Asia Responsible For Exchange Rate Misalignments Within The G20?," Pacific Economic Review, Wiley Blackwell, vol. 13(1), pages 46-61, February.
    • Handle: RePEc:bla:pacecr:v:13:y:2008:i:1:p:46-61
    DOI: 10.1111/j.1468-0106.2007.00389.x
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    Cited by:

    1. Valerio Della Corte & Claire Giordano, 2021. "Methodological issues in the estimation of current account imbalances," Questioni di Economia e Finanza (Occasional Papers) 617, Bank of Italy, Economic Research and International Relations Area.
    2. Yin-Wong Cheung & Shi He, 2019. "Truths and Myths About RMB Misalignment: A Meta-analysis," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 61(3), pages 464-492, September.
    3. Agnès Bénassy‐Quéré & Sophie Béreau & Valérie Mignon, 2009. "Robust Estimations Of Equilibrium Exchange Rates Within The G20: A Panel Beer Approach," Scottish Journal of Political Economy, Scottish Economic Society, vol. 56(5), pages 608-633, November.
    4. Claire Giordano, 2021. "How frequent a BEER? Assessing the impact of data frequency on real exchange rate misalignment estimation," Scottish Journal of Political Economy, Scottish Economic Society, vol. 68(3), pages 365-404, July.
    5. Claire Giordano, 2023. "Revisiting the real exchange rate misalignment‐economic growth nexus via the across‐sector misallocation channel," Review of International Economics, Wiley Blackwell, vol. 31(4), pages 1329-1384, September.
    6. Agnès Bénassy-Quéré & Sophie Béreau & Valérie Mignon, 2008. "How Robust are Estimated Equilibrium Exchange Rates? A Panel BEER Approach," Working Papers 2008-01, CEPII research center.
    7. Yin‐Wong Cheung & Shi He, 2022. "RMB misalignment: What does a meta‐analysis tell us?," Review of International Economics, Wiley Blackwell, vol. 30(4), pages 1038-1086, September.
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    9. Yin-Wong Cheung & Wenhao Wang, 2020. "A Jackknife Model Averaging Analysis of RMB Misalignment Estimates," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 11(02), pages 1-45, June.
    10. Yin-Wong Cheung & Shi He, 2019. "Truths and Myths About RMB Misalignment: A Meta-analysis," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 61(3), pages 464-492, September.
    11. George M. Von Furstenberg, 2008. "Revaluation Pressure And New Exchange Rate Arrangements For East Asia: A Symposium," Pacific Economic Review, Wiley Blackwell, vol. 13(1), pages 40-45, February.

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