EXCHANGE –RATE PASS THROUGH TO IMPORT PRICES: EVIDENCE FROM GHANA

 

John Bosco Dramani and Francis Tandoh
Garden City University College, Ghana

 

ABSTRACT

This paper investigates the transmission rate from exchange rate movement into import prices across product category in Ghana over the past ten years using quarterly data. Using the Autoregressive Distributed Lag approach to cointegration, the paper estimated the degree of pass-through to import price and found a decline in the pass-through elasticities. The results reveal that the transmission rate from exchange rate movement into import prices is incomplete in the short-run; in the long-run however, the pass-through elasticity is larger than the short-run.