Are international fund flows related to exchange rate dynamics?

Li, S., de Haan, J. & Scholtens, B. 13-Sep-2017 In : Open Economies Review.

Research output: Scientific - peer-reviewArticle


  • Fund flows and exchange rate dynamics - Accepted version

    Final author's version, 372 KB, PDF-document

    Embargo ends: 30/11/2018

Employing monthly data for 53 countries between 1996 and 2015, we investigate the relationship between international fund flows and exchange rate dynamics. We find strong co-movement between funds flows (as measured with the EPFR Global data base) and bilateral real exchange rates vis-à-vis the USD. This holds both for equity flows and bond flows. However, bond flows have a more significant relationship with RER appreciation than equity flows in developing countries, while in developed countries equity flows play a more important role. Under a more flexible exchange rate regime the real exchange rate appreciation associated with fund flows is higher.
Original languageEnglish
JournalOpen Economies Review
StateAccepted/In press - 13-Sep-2017


  • international fund flows, exchange rate regime, exchange rate, dynamic panel model

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ID: 48004025