• ISSN: 2010-023X (Print)
    • Abbreviated Title: Int. J. Trade, Economics and Financ.
    • Frequency: Quaterly
    • DOI: 10.18178/IJTEF
    • Editor-in-Chief: Prof.Tung-Zong (Donald) Chang
    • Managing Editor: Ms. Inez. Chan

    • Abstracting/ Indexing:  Crossref, CNKI, EBSCO

    • Article Processing Charge (APC): 500 USD

    • E-mail: ijtef.editorial.office@gmail.com

HOME > Archive > 2011 > Volume 2 Number 4 (Aug. 2011) >
IJTEF 2011 Vol.2(4): 293-299 ISSN: 2010-023X
DOI: 10.7763/IJTEF.2011.V2.120

The Dynamic of Current Account in Emerging East-Asian: Does Exchange Rate Matter?

S. K. Sek and C.L. Chuah

Abstract—The aim of this project is to study the dynamics of a country’s current account with the change of currency exchange rate. This phenomenon becomes more significant when the 1997 financial crisis hits Southeast Asian countries like Malaysia, Indonesia, Singapore, Korea, Thailand and the Philippines. Collected data will be divided into two sub-periods, pre- and post-crisis. By method, the changes can be presented clearly and concretely. In addition, the method of Structural Vector Auto Regressive, SVAR model will use as methodology in this project. Three variables are selected to study for the changes, current account/GDP, CPI and Exchange rate. After the analyzed, we found that actually current account do not change much expected after the crisis. Countries have changed their country financial policy to reduce the impact of fluctuation of currency exchange rate that has long worried. Inflation targeted policy has been become the preferred and priority.

Index Terms—exchange rate, current account dynamics, structural shocks, trade balance.

Dr. S. K. Sek is a Senior Lecturer of School of Mathematical Sciences, Universiti Sains Malayisa, 11800 Minden, Penang, Malaysia. (e-mail: sksek@ usm.my).
C. L. Chuah is a undergraduate student from the School of Mathematical Sciences, Universiti Sains Malaysia, 11800 Minden, Penang, Malaysia. (e-mail: chuah-c@hotmail.com).

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Cite:S. K. Sek and C.L. Chuah, "The Dynamic of Current Account in Emerging East-Asian: Does Exchange Rate Matter?," International Journal of Trade, Economics and Finance vol.2, no.4, pp. 293-299, 2011.

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