JOURNAL ARTICLE

TRADING IN TURBULENT TIMES: COMPARING HOW EXCHANGE RATE VOLATILITY SHAPES ASIAN AND AFRICAN ECONOMIES.

  • Published In: Global Economy Journal, 2025, v. 25, n. 1/2. P. 1 1 of 3

  • Database: Business Source Ultimate 2 of 3

  • Authored By: CHIN, MUI-YIN; MEYER, DANIEL FRANCOIS; ONG, SHEUE LI; FRANCIS, FIONA JANE 3 of 3

Abstract

This study compares the impact of exchange rate volatility on trade performance in middle-income countries in the African and Asian regions. The results show that exchange rate volatility is statistically insignificant in affecting trade in the Asian region, suggesting a mature currency hedging system, while it significantly impacts trade in Africa, where traders' risk-aversion leads to increased exports to mitigate revenue losses from exchange rate fluctuations. The cointegration tests indicate a long-run relationship between exchange rate volatility and trade in both regions, and the causality tests reveal a unidirectional causality from exports to exchange rate volatility in Asia, with a bidirectional relationship in Africa, highlighting regional differences in how exchange rate risk influences trade dynamics. [ABSTRACT FROM AUTHOR]

Additional Information

  • Source:Global Economy Journal. 2025/03, Vol. 25, Issue 1/2, p1
  • Document Type:Article
  • Subject Area:Business and Management
  • Publication Date:2025
  • ISSN:2194-5659
  • DOI:10.1142/S2194565925500010
  • Accession Number:187102078
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