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Determinants of the Swiss Franc Real Exchange Rate


We conduct an empirical investigation of the determinants of the Swiss franc real exchange rate. Theory and related empirical papers suggest various specific factors as potential determinants We select some of these factors, and test their significance and magnitude in affecting the course of the CHF real exchange rate. Results stemming from a co-integration approach point to terms of trade and relative government spending as the most significant explanatory variables. Balassa-Samuelson effects do not play any significant role. Our results also confirm that this kind of empirical approach is sensitive to the choice of explanatory variables, panel countries and sample periods.


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Correspondence to Tommaso Mancini Griffoli.

Additional information

The authors are very grateful to Bruno Parnisari and Peter Steiner (SECO) for supplying previously unavailable data on Swiss sectoral value added, as well as to Gian Maria Milesi Feretti (IMF) for placing his international data set on net foreign assets at our disposal and Richard McKenzie (OECD) for valuable data suggestions. We also wish to thank Thomas Moser, Ulrich Kohli, Michel Peytrignet, Luca Ricci as well as participants to SNB internal seminars for helpful discussions. Finally we thank two anonymous referees: the paper has taken substantial advantage of their comments. The opinions expressed in this paper are solely those of the authors and do not necessarily reflect the view of their affiliated organisations.

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Griffoli, T.M., Meyer, C., Natal, JM. et al. Determinants of the Swiss Franc Real Exchange Rate. Swiss J Economics Statistics 151, 299–331 (2015).

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JEL Classification

  • C33
  • F31


  • real exchange rate
  • Swiss franc
  • government consumption
  • terms of trade
  • net foreign assets
  • GDP per capita
  • Balassa-Samuelson
  • productivity
  • DOLS