Academy of Entrepreneurship Journal (Print ISSN: 1087-9595; Online ISSN: 1528-2686)


Policy Power Capabilities and Leading Indicators of Exchange Rate Stability in 7-Em Countries

Author(s): Ade Novalina, Ramli, Murni Daulay, Dede Ruslan

 This research looks for leading indicators of exchange rate stability, namely economic growth inflation of seven emerging market countries (7-EMC), leading indicators determined by three policies, namely fiscal policy, monetary policy, and macro prudential policy (policy power). Analysis model using ARDL Panel. The study results proved that the leading indicator policy power to stability of exchange rate is a policy power through money supply that can control in China, India, and Brazil. Then macro prudential approach through NPL in Russia and Egypt. Leading indicators of countries that are most able to use policy power in strengthening exchange rate stability are Brazil, Turkey, and Egypt. Finally, policy recommendations in emerging market countries supporting exchange rate stability are China, India, and Brazil through monetary policy.

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