01828cas a2200241 a 4500 AALejournalIMF008374 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451844689 1018-5941 BD-DhAAL BD-DhAAL Cady, John. The Equilibrium Real Exchange Rate of the Malagasy Franc : Estimation and Assessment / John Cady. Washington, D.C. : International Monetary Fund, 2003. 1 online resource (19 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Employing cointegration techniques, the long-run determinants of Madagascar's real exchange rate are examined from a stock-flow perspective. The long-run behavior of the real effective exchange rate is explained by the net foreign asset position and factors affecting trade flows. An index of the long-run equilibrium real exchange rate is developed to assess the degree of misalignment. The general conclusions are that the Malagasy franc has experienced significant misalignment in the past, but that the recent appreciation of the real effective exchange rate is consistent with changes in the fundamentals, particularly anticipated improvements in the net foreign assets position stemming from Madagascar's eligibility for assistance under the enhanced HIPC Initiative. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2003/028 Full text available on IMF http://elibrary.imf.org/view/journals/001/2003/028/001.2003.issue-028-en.xml IMF e-Library