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Impact of Macroeconomic Variables on Exchange Rate: An Evidence from Pakistan

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Advances in Time Series Data Methods in Applied Economic Research (ICOAE 2018)

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Abstract

The purpose of this research is to provide the evidence on the relationship between Real Exchange rate (REXR) against US dollar and macroeconomic variables in Pakistan. This study has taken real exchange rate is dependent variable and some other macroeconomic variables are as independent variables. To examine this relationship the ordinary least square regression (OLS) technique is used. This technique was used by Zamir et al. (2017). The results shows that current balance (CB) is negatively significant at 10% level, the inflation and foreign direct investment (FDI) is also negatively significant at 5, 1% respectively. But the Gross domestic product per capita (GDP) is positively significant at 5% level. The Trade openness (OP) shows no important relation with real exchange rate (REXR). Further the ARCH LM test provides result there is no serial correlation and to check the heteroskedasticity whit test is used this test shows the result there is no heteroskedasticity. This study is helpful for international investor and also to increase export for a country.

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Author information

Authors and Affiliations

  1. College of Business Administration, Liaoning Technical University, Liaoning 125105, Xingcheng, China

    Muhammad Mohsin & Li Naiwen

  2. Liaoning Technical University, Fuxin, People’s Republic of China

    Muhammad Kashif Majeed & Sobia Naseem

Authors
  1. Muhammad Mohsin
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  2. Li Naiwen
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  3. Muhammad Kashif Majeed
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  4. Sobia Naseem
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Corresponding author

Correspondence to Muhammad Mohsin .

Editor information

Editors and Affiliations

  1. Department of International Trade, Western Macedonia University of Applied Sciences, Kastoria, Greece

    Nicholas Tsounis

  2. Department of International Trade, Western Macedonia University of Applied Sciences, Kastoria, Greece

    Aspasia Vlachvei

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Mohsin, M., Naiwen, L., Majeed, M.K., Naseem, S. (2018). Impact of Macroeconomic Variables on Exchange Rate: An Evidence from Pakistan. In: Tsounis, N., Vlachvei, A. (eds) Advances in Time Series Data Methods in Applied Economic Research. ICOAE 2018. Springer Proceedings in Business and Economics. Springer, Cham. https://doi.org/10.1007/978-3-030-02194-8_22

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