The currency exchange rates that we see and use every day are nominal exchange rates. They tell us what we get if we swap a unit of one currency for another – for example, a pound-dollar exchange rate ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. The International Fisher Effect ties ...

Most countries hold large gross asset positions, lending in domestic currency and borrowing in foreign. Thus, their balance sheets are exposed to nominal exchange rates. We argue that when asset ...

The Economic Issues series was inaugurated in September 1996. Its aim is to make some of the economic research being produced in the International Monetary Fund on topical issues accessible to a broad ...

Steven Nickolas is a writer and has 10+ years of experience working as a consultant to retail and institutional investors. David is comprehensively experienced in many facets of financial and legal ...

Tara Iyer of the University of Oxford’s economics department takes a look at monetary policy in emerging market economies, writing that the majority of households in such economies are excluded from ...

This paper presents a model of an economy that uses nominal exchange rate policy to keep the real exchange rate constant at a certain target level, under an assumption of imperfect asset ...

Exchange rate pass‐through refers to the extent to which fluctuations in the nominal exchange rate affect domestic prices—both at the producer and consumer levels. This dynamic plays a pivotal role in ...

AROUND $5 trillion is traded on the foreign-exchange markets every single day, according to a recent survey sponsored by the world’s big central banks. That compares with global trade in goods and ...

The nominal interest rate is the simple interest charged on a loan or paid on a deposit. Real interest is nominal interest after taking inflation’s effects into account. Economists, as well as lenders ...

Exchange rate stabilization or currency “pegs” are among the most prevalent interventions in international financial markets. Removing a peg to a safer currency can make the home currency more risky ...