An Empirical Analysis of the Determinants of Exchange Rate in Selected SSA Countries Using Single-Country Estimation Techniques

Mauritius - 2 July 2018

Trade topics: Other

Exchange rate has become a buoyant issue in a globalized world where countries compete with each other to sustain growth and development. Despite the importance of exchange rate in sustaining economic growth and development in Sub-Saharan African (SSA) countries, empirical analyses in these countries are quite sparse. Research done in this area focusing on each of these countries remains more fairly limited. Hence, this study aims at investigating the determinants of exchange rate in selected Sub-Saharan African countries using single-country estimation techniques. In particular, an autoregressive distributed lag (ARDL) model is employed to examine the determinants of exchange rate in nine SSA countries using annual data spanning from 1980 to 2013. Our findings show that the long-run and short-run relationships between exchange rate and its determinants rely upon the country investigated.