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| Marco A Kerbeg, Mathias S Tessmann, Gustavo C Haase and Thiago T Lourenço |
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| ''The effects of interest rates on the BRICS exchange rate: a 2SLS approach'' |
| ( 2025, Vol. 45 No.1 ) |
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| This study explores the impact of interest rates on the exchange rates of the BRICS nations—Brazil, Russia, India, China, and South Africa. By incorporating control variables such as inflation and broad money supply, this analysis employs Granger causality tests to detect potential endogeneity and estimates a Two-Stage Least Squares (2SLS) model using panel data. The findings reveal that interest rates significantly influence exchange rates in these countries, emphasizing their importance in the formulation of effective monetary policies. |
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| Keywords: BRICS, Exchange Rate, Interest Rate, Inflation, Monetary Offer, 2SLS. |
JEL: E4 - Money and Interest Rates: General
E3 - Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data) |
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| Manuscript Received : Jun 12 2024 | | Manuscript Accepted : Mar 30 2025 |
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