Roubini (2000) Exchange Rate Anomalies in the Industrial Countries: A Solution with a Structural VAR Approach.
Kohli (2000) Exchange Rate Dynamics with Financial Repression: A Test of Exchange Rate Models for India.
The central bank governor showed off a chart mapping the average quarterly historical exchange rate against the external deficit.
"It was not an appropriate policy to keep a fixed exchange rate for long, due to which our situation today has been created."
Next year, FY16, the average exchange rate was recorded at 104.23.
It is important to mention that in the first five months of FY18 (July-November), the average exchange rate was 105.35, while in the next seven months (December-June), the exchange rate on average was recorded at 113.05.
A country's exchange rate can be a bilateral rate, such as the Egyptian pounds per dollar for Egypt, or a multilateral rate where, the Egyptian pound is expressed in terms of a weighted average of Egypt's bilateral exchange rates against its main trading partners.
Where [BRER.sub.ijt] is the bilateral real exchange rate of country j with the trading partner i at time t (Weerasekera, 1992; Fleissig& Grennes, 1994).
The currency board keeps a set exchange rate against a benchmark currency such as the US dollar.
We could peg the peso to another currency and set the exchange rate at the best level.
The two main sets of theoretical models, the "Flow and Stock" oriented models, have been espoused to study the nexus between stock prices and exchange rates. "Flow" oriented model (Dornbusch and Fischer, 1980), postulates that the major determinant of the exchange rate is trade flows; and that the trade balance affects the changes in exchange rate, which eventually affect real income and output.
Aggarwal (2003), employed monthly data for the period 1974 to 1978 to explore the correlation between stock prices and exchange rates. With the use of an aggregate index of stock prices and the exchange rate of USD, he revealed that there exists, a positive relationship between stock prices and exchange rates, as USD depreciation leads to stock price to decline.