Exchange rate and balance of payments – a correlation that got lost?
News, Staff memo There is no clear picture of how the relationship between the exchange rate and the real and financial transactions between countries functions in practice.
In this Staff Memo, the authors present some economic assumptions that attempt to explain this relationship and analyse data for Sweden for the period 1993 onwards. The study focuses on whether there is any covariation between the Swedish krona exchange rate and data from the balance of payments statistics.
This Staff Memo was written by José Camacho and Anders Lindström at the Riksbank’s Monetary Policy Department.
A Staff Memo is a publication in which Riksbank staff can publish advanced analyses of relevant issues. It is a staff publication free of policy conclusions and personal standpoints in current policy issues.