Focusing on the Exchange Rate Volatility and International Trade Relationship: Evidence from South Africa
Focusing on the Exchange Rate Volatility and International Trade Relationship: Evidence from South Africa
Author(s): Ntokozo HADEBE, Simiso MSOMISubject(s): Economy, National Economy, Financial Markets, Public Finances
Published by: EDITURA ASE
Keywords: exchange rate; volatility; exports; GDP
Summary/Abstract: Despite the extensive literature on the exchange rates volatility and international trade, there is no consensus in the literature. This study examines how South African exports demand is affected by exchange rate volatility. The sample period covers the period from the year 2000 first quarter to the beginning of 2021 first quarter. To estimate the volatility of the exchange rates, in this study, we have used the Generalised Autoregressive Conditional Heteroscedastic (GARCH) mode. While we use Autoregressive Distributed lags (ARDL) models to estimate the impact of exchange rates volatility on domestic exports. The findings suggested that there is a positive relationship between exchange rate volatility and exports. Hence, policies such as bilateral trade agreements are important to promote export growth.
Journal: Management and Economics Review
- Issue Year: 8/2023
- Issue No: 3
- Page Range: 354-367
- Page Count: 14
- Language: English