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Exchange rate determination in Vietnam

Author

Listed:
  • Thai-Ha Le

    (RMIT University (Vietnam Campus))

Abstract
This study investigates the determinants of the exchange rate in Vietnam and suggests policy implications. Gregory-Hansen cointegration tests and generalised variance decomposition (VDC) analysis were applied to monthly data from July 2004 to December 2013. The model was built based on the three popular approaches to exchange rate determination, which are purchasing power parity (PPP) approach, balance of payment (BOP) approach, and monetary and portfolio approach. This study finds that the price ratio between Vietnam and the US is an important determinant of Vietnam's exchange rate.

Suggested Citation

  • Thai-Ha Le, 2015. "Exchange rate determination in Vietnam," Economics Bulletin, AccessEcon, vol. 35(1), pages 657-664.
    • Handle: RePEc:ebl:ecbull:eb-14-00481
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2015/Volume35/EB-15-V35-I1-P70.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    Cited by:

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    More about this item

    Keywords

    exchange rate determination; BOP approach; monetary and portfolio approach; PPP approach; Vietnam.;
    All these keywords.

    JEL classification:

    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates
    • F3 - International Economics - - International Finance

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