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Equilibrium Exchange Rate

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Equilibrium exchange rate
Exchange rate at which demand for a currency is equal to the supply of the currency in the economy.

Equilibrium Exchange Rate
The exchange rate at which the demand for a currency and supply of the same currency are equal. The equilibrium exchange rate indicates that the price of exchanging two currencies will remain stable. See also: Equilibrium rate of interest.


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Following an overview of key issues, chapters discuss monetary policy independence, the currency regime, and the capital account in China; imbalances in China's growth; estimates of the equilibrium exchange rate of the renminbi; the management of China's international reserves; the US Congress and the Chinese renminbi; the influence of the renminbi on the exchange rate policies of other Asian countries; and International Monetary Fund surveillance over China's exchange rate policy.
The depreciation in the effective exchange rates of the euro and pound "should come largely from the appreciations of a number of Asian currencies," according to the report "New estimates of fundamental equilibrium exchange rates.
The depreciation in the effective exchange rates of the euro and pound "should come largely from the appreciations of a number of Asian currencies," according to the report "New estimates of fundamental equilibrium exchange rates.
 
 
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