Currency depreciation and inflationary pressure vis-à-vis monetary intervention: perspectives on growth and policy implications

Edo, Samson; Sowemimo, Eseosa Joy

doi:10.3326/pse.50.1.7.

7468
Views

149
Downloads

Currency depreciation and inflationary pressure vis-à-vis monetary intervention: perspectives on growth and policy implications

Samson Edo*

Eseosa Joy Sowemimo*

Download citation

https://doi.org/10.3326/pse.50.1.7

FULL ARTICLE

FIGURES & DATA

REFERENCES

CROSSMARK POLICY

METRICS

LICENCING

PDF

Andrei, J. V., Mieila, M. and Panait, M., 2017. The Impact and Determinants of the Energy Paradigm on Economic Growth in European Union. PLoS ONE, 12(3), e0173282 [CrossRef]

Bandaogo, M. S., 2021. Central Bank Independence Matters. Research and Policy Briefs, No. 53 [CrossRef]

Benigno, G., Converse, N. and Fornaro, L., 2015. Large Capital Inflows, Sectoral Allocation, and Economic Performance. Journal of International Money and Finance, 55(1), pp. 60-87 [CrossRef]

Bouvet, F., Bower, R. and Jones, J. C., 2022. Currency Devaluation as a Source of Growth in Africa: A Synthetic Control Approach. Eastern Economic Journal, 48(1), pp. 367-389 [CrossRef]

Bruno, M., 1979. Stabilization and Stagflation in a Semi-industrialized Economy. In: R. Dorbusch and J. Frankel, eds. International Economic Policy. Baltimore: Johns Hopkins University Press.

Dada, M. A. [et al.], 2022. Effect Of Currency Devaluation on Economic Growth In Nigeria: New Evidence From Dynamic OLS. Ilorin Journal of Business and Social Sciences, 24(1), pp. 1-19.

Di Nino, V., Eichengreen, B. and Sbracia, M., 2011. Real Exchange Rates, Trade, and Growth: Italy 1861-2011. Bank of Italy Economic History Working Papers, No. 10 [CrossRef]

Diaz-Alejandro, C. F., 1963. Note on the Impact of devaluation and Re-distributive Effect. Journal of Political Economy, 71(3), pp. 577-580 [CrossRef]

Dornbusch, R., 1987. Open Economy Macroeconomics: New Directions. NBER Working Paper, No. 2372 [CrossRef]

Gluzmann, P. A., Levy-Yeyati, E. and Sturzenegger, F., 2012. Exchange Rate Un-devaluation and Economic Growth: Díaz Alejandro (1965) revisited. Economics Letters, 117(3), pp. 666-672 [CrossRef]

Habib, M., Mileva, E. and Stracca, L., 2016. The Real Exchange Rate and Economic Growth: Revisiting the Case Using External Instruments. ECB Working Paper, No 1921 [CrossRef]

Han, Y., 2020. The Impact of Exchange Rate Fluctuation on Economic Growth: Empirical Studies Based on Different Countries. Advances in Economics, Business and Management Research, 146(1), pp. 29-33.

Hirschman, A. O., 1949. Devaluation and the Trade Balance: A Note. Review of Economics and Statistics, 31(1), pp. 50-53 [CrossRef]

Huong, D. T. M., 2019. Real Exchange Rate and Economic Growth: An Empirical Assessment for Vietnam. Asian Economic and Financial Review, 9(6), pp. 680-690 [CrossRef]

IMF, 2023. Managing Exchange Rate Pressures in Sub-Saharan Africa – Adapting to New Realities. Regional Economic Outlook Analytical Note on Sub-Saharan Africa. Washington D. C: International Monetary Fund.

Kandil, M. and Mirzaie, A., 2003. The Effect of Exchange Rate Fluctuations on Output and Prices: Evidence from Developing Countries. IMF Working Paper, WP/03/200 [CrossRef]

Kemoe, L., Mama, M. and Mighri, H., 2023. Exchange Rate Pressures Take a Toll on Sub-Saharan Africa. AUDA-NEPAD Report on African Futures. Midrand: African Union Development Agency.

Kubota, M. and Calderson, C., 2024. Currencies and Inflation Across Sub-Saharan Africa in 2024: Divergent Experiences. Report on Africa Can End Poverty. Washington D. C.: World Bank Group.

Kuo, C., 2016. Does the Vector Error Correction Model Perform Better than Others in Forecasting Stock Price? An Application of Residual Income Value Theory. Economic Modelling, 52(2), pp. 772-789 [CrossRef]

Lavalliere, H. K., Molina, F. T. and Chaudhary, S. M., 2023. Effect of Currency Devaluation on Performance of Small and Medium Firms in Beirut, Lebanon. Journal of Economics, 7(1), pp. 12-21 [CrossRef]

Matemilola, B., Bany-Ariffin, A. and Azman-Saini, W., 2012. Financial Leverage and Shareholder’s Required Returns: Evidence from South Africa Corporate Sector. Transit Studies Review, 18(1), pp. 601-612 [CrossRef]

Meade, J. F., 1951. The Theory of International Economic Policy. Oxford: Oxford University Press.

Nguyen, A. [et al.], 2017. On the Drivers of Inflation in Sub-Saharan Africa. International Economics, 151(1), pp. 71-84 [CrossRef]

OECD, 2020. Quality Infrastructure in the 21st Century Africa: Prioritizing, Accelerating and Scaling up in the Context of Pida 2021-30. Paris: OECD.

Ojong, F. and Bessong, F. E., 2017. Corruption and Infrastructure in Africa: Challenges for Integrated Sustainable Development. International Journal of Development Strategies in Humanities, Management and Social Sciences, 7(3), pp. 103-111.

Okot, A., Kaltenbrunner, A. and Perez, D., 2022. Determinants of Exchange Rate, Its Volatility and Currency Risk in Africa’s Low and Lower Middle-income Countries. EIB Working Papers, 2022/12.

Park, J., 2019. Assessing the Role of Foreign Aid, Donors and Recipients. In: J. D. Park, ed. Re-Inventing Africa's Development. London: Palgrave Macmillan, pp. 37-60 [CrossRef]

Pedroni, P., 2001. Fully Modified OLS for Heterogeneous Co-integrated Panels. In: B. H. Baltagi [et al.], eds. Nonstationary Panels, Panel Cointegration, and Dynamic Panels. Bingley: Emerald Group, pp. 93-130.

Ramoni-Perazzi, J. and Romero, H., 2022. Exchange Rate Volatility, Corruption, and Economic Growth. Heliyon, 8(12), pp. 1-28 [CrossRef]

Rodrik, D., 2008. The Real Exchange Rate and Economic Growth. Brookings Papers on Economic Activity, 39(2), pp. 365-439 [CrossRef]

Serena, J. M. and Sousa, R., 2017. Does Exchange Rate Depreciation Have Contractionary Effects on Firm-level Investment? The Implications of Alternative Types of Bond Financing. BIS Working Paper, No. 624.

Stock, J. H. and Watson, M. W., 1993. A Simple Estimator of Co-integrating Vectors in Higher Order Integrated Systems. Econometrica, 61(4), pp. 783-820 [CrossRef]

Taghizadeh-Hesary, F. [et al.], 2019. Quality Infrastructure and Natural Disaster Resiliency. ADBI Working Paper, No. 991.

UNCTAD, 2022. Economic Development in Africa Report 2022. Geneva: UNCTAD.

Van Wijnbergen, S., 1989. Exchange Rate Management and Stabilization Policies in Developing Countries. Journal of Development Economics, 23(1), pp. 227-247 [CrossRef]

World Bank, 2019. Currency Depreciation, Inflation, and Central Bank Independence. Global Economic Prospects Special Focus, No. 1.2.

World Bank, 2023. An Analysis of Issues Shaping Africa’s Economic Future. Africa’s Pulse Report, No. 28 [CrossRef]

Yu, J., Jong, R. and Lee, L., 2008. Quasi-maximum Likelihood Estimators for Spatial Dynamic Panel Data with Fixed Effects when Both N and T are Large. Journal of Econometrics, 146(1), pp. 118-134 [CrossRef]

March, 2026
I/2026

Balázs Égert, Dubravko Mihaljek
Exchange rate issues
Guest editors’ introduction to the thematic issue of Public Sector Economics

Frane Banić, Guzmán González-Torres
Different strokes for different folks: untangling supply and demand shocks using survey-data to assess sectoral inflationary pressures in Croatia

Jakov Čorak, Mihael Brusan
Inflation in Croatia: a new era of forecasting with machine learning

Aaron Mehrotra
Public debt and the dollar

Sergii Sheludko
When the guns roar: how the war, reserves and exports shape Ukraine’s cost of external borrowing

Juan Camilo Anzoátegui Zapata, Danilo Rodríguez Arango, Sergio David Sánchez Varela
Effects of reputation and monetary policy communication on exchange rate uncertainty: evidence from an emerging market economy

Samson Edo, Eseosa Joy Sowemimo
Currency depreciation and inflationary pressure vis-à-vis monetary intervention: perspectives on growth and policy implications

Mislav Brkić
Our Dollar, Your Problem