Exchange Rate Pass-Through in an Emerging Market: The Case of the Czech Republic

@inproceedings{Hjek2016ExchangeRP,
  title={Exchange Rate Pass-Through in an Emerging Market: The Case of the Czech Republic},
  author={J{\'a}n H{\'a}jek and Roman Horv{\'a}th},
  year={2016}
}
We examine exchange rate pass-through, or how domestic prices respond to exchange rate shocks, in the Czech Republic from 1998 to 2013 by employing vector autoregression models. Using the aggregate consumer price index and its sub-components, we find that the degree of passthrough is incomplete except for food prices. The peak response occurs between 9 and 13 months after the exchange rate shock. The long-term pass-through is approximately 50% at the aggregate level. The degree of pass-through… CONTINUE READING