01731cas a2200241 a 4500 AALejournalIMF010083 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451968859 1018-5941 BD-DhAAL BD-DhAAL International Monetary Fund. Real Exchange Rates and Commodity Prices in Neoclassical Model. Washington, D.C. : International Monetary Fund, 1988. 1 online resource (46 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 This paper presents a neoclassical model that explains the observed empirical relationship between government spending and world commodity supplies and the real exchange rate and real commodity prices. It is shown that fiscal expansion and increasing world commodity supplies simultaneously lead to an appreciation of the real exchange rate and a decline in relative commodity prices. This structural model is estimated and its forecasting performance is compared to a variety of models. We find that theory and structure help in predicting commodity prices, although not the exchange rate, and that predictive ability increases as the forecast horizon is lengthened. MASTER FILES ROOM C-130 001. Mode of access: Internet IMF Working Papers; Working Paper ; No. 1988/055 Full text available on IMF http://elibrary.imf.org/view/journals/001/1988/055/001.1988.issue-055-en.xml IMF e-Library