nominal exchange rate

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Nominal exchange rate

The actual foreign exchange quotation in contrast to the real exchange rate, which has been adjusted for changes in purchasing power.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Nominal Exchange Rate

The official quote of an exchange rate. For example, when one changes dollars for pounds, the bank lists an exchange rate of, say, two dollars for one pound. This is the nominal exchange rate. While this indicates the number of pounds one receives for a dollar (or vice versa), it does not show the purchasing power of the pound versus that of the dollar. See also: Real Exchange Rate.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

nominal exchange rate

the EXCHANGE RATE of a currency expressed in current price terms, that is, making no allowance for the effects of INFLATION. Contrast REAL EXCHANGE RATE.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
On one hand, it could be the result of a highly negative correlation between nominal exchange rates and foreign prices.
Data on the nominal exchange rates for all the four countries is available in terms of US Dollar.
These structural factors could not be affected by movements in nominal exchange rates.
(13) In the model, changes in nominal exchange rates are driven by a monetary shock, which is a reduction in money demand for the domestic currency.
How then does sterilized intervention affect nominal exchange rates?
manufactured goods depends not on the behavior of nominal exchange rates, but on movements in nominal exchange rates relative to prices.
That is, real and nominal exchange rates are about six times more volatile than relative price levels and both are highly persistent, with first-order serial correlations of about 0.85 and 0.83, respectively, at annual frequency.
The paper undertakes an extensive examination of the behaviour of the Norwegian real and nominal exchange rates and shows that it is remarkably consistent with the PPP theory.
The revaluation of the central rate of the Irish pound in the run-up to EMU in the spring of 1998 also showed a readiness to adjust nominal exchange rates when this is believed to contribute to macroeconomic stability.
To avoid estimation problems arising from this correlation, Equation 4 may have to be estimated in terms of nominal exchange rates if the variable lnPD is included in the cointegrating equation.
consumer prices to foreign consumer prices translated into dollars at current nominal exchange rates (chart 4).