Abstract

CARRERAS MAYER, Pablo. Devaluaciones reales y aceleraciones inflacionarias. Estud. Econ. [online]. 2017, vol.34, n.68, pp. 39-73. ISSN 2525-1295.

Open economies may experience trade-offs between increments in the real exchange rate (RER) and inflation accelerations lasting throughout relevant time horizons. A methodology is applied on a monthly panel comprising 98 countries during 1970-2014. Episodes of "significant and extended" increases of the RER are identified, classifying them as "accelerating" or "non-accelerating" according to inflation dynamics. The inflationary response of the regions under study is highly heterogenous, as well as between emerging and advanced economies. The probability of an "accelerating" episode (i) increases the higher the initial inflation rate, (ii) is not affected by the output gap, (iii) diminishes under Inflation Targeting regimes, and (iv) diminishes the stronger is the nominal exchange rate anchor after the devaluation.

Keywords : Open Economy Macroeconomics; Inflation; Foreign Exchange.