@workingpaper{Asongu2014b_29,
title = {Real Effective Exchange Rate Imbalances and Macroeconomic Adjustments: evidence from the CEMAC zone},
author = {Simplice A Asongu},
editor = {African 2014 Governance and Development Institute WP/19/14},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/REER-imbalances-and-macroeconomic-adjustments-in-the-CEMAC-zone.pdf},
year = {2014},
date = {2014-01-01},
abstract = {We assess the behavior of real effective exchange rates (REERs) of members of the
CEMAC zone with respect to their long-term equilibrium paths. A reduced form of the
fundamental equilibrium exchange rate (FEER) model is estimated and associated
misalignments are derived for the period 1980 to 2009. Our findings suggest that for majority
of countries, macroeconomic fundamentals have the expected associations with the exchange
rate fluctuations. The analysis also reveals that, only the REER adjustments of Cameroon and
Gabon are significant in restoring the long-term equilibrium in event of a shock. The
Cameroonian economic fundamentals of terms of trade, government expenditure and openness
have different long-term relations with the REER in comparison to those of other member
states. Ultimately, there is no need for an adjustment in the level of the peg based on the present
quantitative analysis of REER paths.},
keywords = {Exchange rate; Macroeconomic impact; CEMAC zone},
pubstate = {published},
tppubtype = {workingpaper}
}