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Tariffs and the exchange rate : evidence from Twitter / by Dmitry Matveev and Francisco Ruge-Murcia.: FB3-5/2021-36E-PDF

"This paper examines the conjecture that an increase in tariffs in a flexible exchange rate regime leads to the appreciation of the local currency. We focus on the reaction of the exchange rate market to tweets by US President Donald Trump regarding possible tariff increases on Canadian and Mexican goods. The anticipation of trade restrictions leads to the US dollar appreciating by 0.023% and 0.051% vis-à-vis the Canadian dollar and Mexican peso within five minutes of the tweet, and comparable percentages for forward rates up to five years ahead. Exchange rate appreciation may mitigate the expenditure-switching intended by the protectionist policy"--Abstract, page ii.

Permanent link to this Catalogue record:
publications.gc.ca/pub?id=9.903144&sl=0

Publication information
Department/Agency
  • Bank of Canada, issuing body.
TitleTariffs and the exchange rate : evidence from Twitter / by Dmitry Matveev and Francisco Ruge-Murcia.
Series title
  • Staff working paper = Document de travail du personnel, 1701-9397 ; 2021-36
Publication typeMonograph - View Master Record
Language[English]
FormatDigital text
Electronic document
Note(s)
  • "Last updated: July 21, 2021."
  • Includes bibliographical references (pages 26-27).
Publishing information
  • Ottawa, Ontario, Canada : Bank of Canada = Banque du Canada, 2021.
  • ©2021
Author / Contributor
  • Matveev, Dmitry, author.
Description1 online resource (ii, 27 pages) : colour illustrations.
Catalogue number
  • FB3-5/2021-36E-PDF
Subject terms
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