Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade

This article empirically evaluates Malaysian foreign trade effects through two types of exchange rate variability; misalignments and volatility across different exchange rate regimes from 1991:Q1 to 2003:Q4. The Natural Real Exchange Rate (NATREX) equilibrium model is employed to generate the real e...

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Main Authors:	Naseem, N.A.M., Hui-Boon , Tan, Siti Hamizah Mohd
Format:	Article
Published:	Penerbit Universiti Kebangsaan Malaysia 2010
Online Access:	http://journalarticle.ukm.my/3371/ http://journalarticle.ukm.my/3371/

id	ukm-3371
recordtype	eprints
spelling	ukm-33712012-03-23T07:02:41Z http://journalarticle.ukm.my/3371/ Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade Naseem, N.A.M. Hui-Boon , Tan Siti Hamizah Mohd, This article empirically evaluates Malaysian foreign trade effects through two types of exchange rate variability; misalignments and volatility across different exchange rate regimes from 1991:Q1 to 2003:Q4. The Natural Real Exchange Rate (NATREX) equilibrium model is employed to generate the real exchange rate misalignment while the GARCH (1, 1) model is used to measure the real exchange rate volatility, which is then tested in a model of Malaysian imports and exports. This paper differs from existing literature as the effects of exchange rate misalignment significantly hastened the level of Malaysian exports and imports for the periods, managed floating and pegged rate. On the other hand, the exchange rate volatility has merely promoted the Malaysian exports and imports during the implementation of pegged rate. This proposes that the variability of exchange rate and exchange rate regimes are important determinants in inspiring Malaysian foreign trade, especially during the 1997 financial crisis when the economic is distressed. Penerbit Universiti Kebangsaan Malaysia 2010-12 Article PeerReviewed Naseem, N.A.M. and Hui-Boon , Tan and Siti Hamizah Mohd, (2010) Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade. Jurnal Ekonomi Malaysia, 44 . ISSN 0127-1962 http://www.ukm.my/penerbit/JEM/JEM-44-04-abstrak.html
repository_type	Digital Repository
institution_category	Local University
institution	Universiti Kebangasaan Malaysia
building	UKM Institutional Repository
collection	Online Access
description	This article empirically evaluates Malaysian foreign trade effects through two types of exchange rate variability; misalignments and volatility across different exchange rate regimes from 1991:Q1 to 2003:Q4. The Natural Real Exchange Rate (NATREX) equilibrium model is employed to generate the real exchange rate misalignment while the GARCH (1, 1) model is used to measure the real exchange rate volatility, which is then tested in a model of Malaysian imports and exports. This paper differs from existing literature as the effects of exchange rate misalignment significantly hastened the level of Malaysian exports and imports for the periods, managed floating and pegged rate. On the other hand, the exchange rate volatility has merely promoted the Malaysian exports and imports during the implementation of pegged rate. This proposes that the variability of exchange rate and exchange rate regimes are important determinants in inspiring Malaysian foreign trade, especially during the 1997 financial crisis when the economic is distressed.
format	Article
author	Naseem, N.A.M. Hui-Boon , Tan Siti Hamizah Mohd,
spellingShingle	Naseem, N.A.M. Hui-Boon , Tan Siti Hamizah Mohd, Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade
author_facet	Naseem, N.A.M. Hui-Boon , Tan Siti Hamizah Mohd,
author_sort	Naseem, N.A.M.
title	Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade
title_short	Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade
title_full	Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade
title_fullStr	Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade
title_full_unstemmed	Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade
title_sort	exchange rate regime, exchange rate variability and flows of malaysia’s foreign trade
publisher	Penerbit Universiti Kebangsaan Malaysia
publishDate	2010
url	http://journalarticle.ukm.my/3371/ http://journalarticle.ukm.my/3371/
first_indexed	2023-09-18T19:38:35Z
last_indexed	2023-09-18T19:38:35Z
_version_	1777405437884235776

Exchange rate regime, exchange rate variability and flows of Malaysia’s foreign trade

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