DOES THE SERVICE TRADE OPENNESS MITIGATE REAL EXCHANGE RATE VOLATILITY?

Authors

Febrio Kacaribu, University of Indonesia, IndonesiaFollow
Syahda Sabrina, University of Indonesia, IndonesiaFollow
Teuku Muhammad Riefky Hasan, University of Indonesia, IndonesiaFollow

Document Type

Article

Abstract

This study examines the relationship between trade openness and exchange rate volatility. We use panel data of 52 countries and document trade openness has a negative and statistically significant effect on exchange rate volatility. The second explanatory variable considered in the model is money supply shock which is found to have a positive and statistically significant effect on exchange rate volatility. Our results survive battery of robustness checks.

Recommended Citation

Kacaribu, Febrio; Sabrina, Syahda; and Hasan, Teuku Muhammad Riefky (2021) "DOES THE SERVICE TRADE OPENNESS MITIGATE REAL EXCHANGE RATE VOLATILITY?," Bulletin of Monetary Economics and Banking: Vol. 24: No. 2, Article 7.
DOI: https://doi.org/10.21098/bemp.v24i2.1168
Available at: https://bulletin.bmeb-bi.org/bmeb/vol24/iss2/7

First Page

237

Last Page

254

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License

Country

Indonesia

Affiliation

University of Indonesia