Exchange Rate Volatility and Balance of Payments Adjustment in Pakistan

Thesis title: Exchange Rate Volatility and Balance of Payments Adjustment in Pakistan
Author: Mehak, Fatima
Thesis type: Diploma thesis
Supervisor: Čermáková, Klára
Opponents: Štěpánek, Pavel
Thesis language: English
Abstract:
This study investigates how exchange rate volatility affects Pakistan's balance of payments (BOP). It draws attention to Pakistan's recent fluctuating currency rates and how they have affected the country's economy, especially by reducing foreign exchange reserves and widening the trade imbalances. With an emphasis on exports, imports, and the overall effect of exchange rate volatility on the balance of payments, the study intends to analyze the relationship between exchange rate movements and Pakistan's current account balance. The study's conclusions have important policy implications for regulating currency rate volatility, fostering exports, and enhancing the balance of payments. The paper will provide a review of the literature, a theoretical framework, and empirical analysis before drawing the conclusion that stabilizing exchange rates, fostering exports, and managing volatility may or may not improve Pakistan's balance of payments with an aim to promote overall economic stability. The study's conclusions may also be applicable to other nations dealing with comparable difficulties in maintaining their balance of payments in the face of exchange rate changes.
Keywords: Pakistan; Balance of Payment; Exchange Rate Volatility; Imports; Exports; Current Account Balance; Trade Deficit; Economic Stability; State Bank of Pakistan; Foreign Exchange Reserves; Competitiveness
Thesis title: Exchange Rate Volatility and Balance of Payments Adjustment in Pakistan
Author: Mehak, Fatima
Thesis type: Diplomová práce
Supervisor: Čermáková, Klára
Opponents: Štěpánek, Pavel
Thesis language: English
Abstract:
This study investigates how exchange rate volatility affects Pakistan's balance of payments (BOP). It draws attention to Pakistan's recent fluctuating currency rates and how they have affected the country's economy, especially by reducing foreign exchange reserves and widening the trade imbalances. With an emphasis on exports, imports, and the overall effect of exchange rate volatility on the balance of payments, the study intends to analyze the relationship between exchange rate movements and Pakistan's current account balance. The study's conclusions have important policy implications for regulating currency rate volatility, fostering exports, and enhancing the balance of payments. The paper will provide a review of the literature, a theoretical framework, and empirical analysis before drawing the conclusion that stabilizing exchange rates, fostering exports, and managing volatility may or may not improve Pakistan's balance of payments with an aim to promote overall economic stability. The study's conclusions may also be applicable to other nations dealing with comparable difficulties in maintaining their balance of payments in the face of exchange rate changes.
Keywords: Pakistan; Balance of Payment; Exchange Rate Volatility

Information about study

Study programme: Economics and Public Policy
Type of study programme: Magisterský studijní program
Assigned degree: Ing.
Institutions assigning academic degree: Vysoká škola ekonomická v Praze
Faculty: Faculty of Economics
Department: Department of Economics

Information on submission and defense

Date of assignment: 23. 2. 2023
Date of submission: 12. 8. 2023
Date of defense: 3. 10. 2023
Identifier in the InSIS system: https://insis.vse.cz/zp/83883/podrobnosti

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