Making Sense of Exchange Rate Pressures in Macroeconomic Statistics

The paper explores new statistical approaches for studying links between cross-border financial flows and the exchange rate. The paper first discusses limitations of the balance of payments statistics in analysing foreign exchange market imbalances by explaining the methodological principles that dr...

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Bibliographic Details
Main Authors: Anna Drahozalová, Václav Rybáček
Format: Article
Language:English
Published: Czech Statistical Office 2025-03-01
Series:Statistika: Statistics and Economy Journal
Subjects:
Online Access:https://csu.gov.cz/docs/107508/110bbb50-90a7-d79c-92b3-452840739dd2/32019725q1_drahozalova_rybacek_barva.pdf?version=1.1
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Summary:The paper explores new statistical approaches for studying links between cross-border financial flows and the exchange rate. The paper first discusses limitations of the balance of payments statistics in analysing foreign exchange market imbalances by explaining the methodological principles that drive a wedge between balance of payments transactions and cross-border flows. Then it continues with a discussion on the analytical potential of the so-called monetary presentation of the balance payments. Visual analysis tentatively suggests that in the case of the CZK/EUR currency pair, net external flows (an aggregate identified by the monetary presentation) can explain reasonably well past exchange rate developments, if adjusted for central bank intervention.
ISSN:0322-788X
1804-8765