Tytuł:

Does a trade surplus raise the exchange rate exposure? A perspective on Sino-US relations

Tytuł publikacji grupowej:

Argumenta Oeconomica

Autor:

Su, Chi-Wei ; Yuan, Xi ; Tao, Ran ; Umar, Muhammad ; Huang, Shi-Wen

Temat i słowa kluczowe:

exchange rate exposure ; trade surplus ; rolling window ; bootstrap

Opis:

Argumenta Oeconomica, 2022, Nr 2 (49), s. 173-198

Abstrakt:

This research examines dynamic causality between trade surplus (TS) and exchange rate exposure (ERE), utilizing the bootstrap sub-sample rolling window test. The empirical findings indicate that there is the time-varying bidirectional causality in TS and ERE within certain sub-periods. Specifically, ERE manifests both positive and negative influences on TS. In turn, TS has a positive effect on ERE which proves the export-oriented model proposed by Bodnar et al. (2002). Furthermore, due to the complex changes in Sino-US trade policies during the trade war, ERE is still stimulated under the overall downward trend of TS. This means that the widening TS can inevitably increase ERE, which may cause more trade frictions with the US. By studying the time-varying relation between these two variables, investors can reasonably allocate assets according to the changes of TS and avoid losses caused by market panic. Policy-makers could restrict the abnormal flow of international capital and promote multilateral trade cooperation, especially in times of structural economic change, to reduce trade friction and maintain a relatively stable ERE level.

Wydawca:

Publishing House of Wroclaw University of Economics and Business

Miejsce wydania:

Wroclaw

Data wydania:

2022

Typ zasobu:

artykuł

Identyfikator zasobu:

doi:10.15611/aoe.2022.2.09

Język:

eng

Powiązania:

Argumenta Oeconomica, 2022, Nr 2 (49)

Prawa:

Pewne prawa zastrzeżone na rzecz Autorów i Wydawcy

Prawa dostępu:

Dla wszystkich zgodnie z licencją

Licencja:

CC BY-SA 4.0

Lokalizacja oryginału:

Uniwersytet Ekonomiczny we Wrocławiu