Are international fund flows related to exchange rate dynamics?

Suxiao Li, Jakob de Haan, Bert Scholtens

Research output: Contribution to journalArticlepeer-review

2 Citations (Scopus)
1 Downloads (Pure)


Employing monthly data for 53 countries between 1996 and 2015, we investigate the relationship between international fund flows and exchange rate dynamics. We find strong co-movement between funds flows (as measured with the EPFR Global data base) and bilateral real exchange rates vis-à-vis the USD. This holds both for equity flows and bond flows. However, bond flows have a more significant relationship with RER appreciation than equity flows in developing countries, while in developed countries equity flows play a more important role. Under a more flexible exchange rate regime the real exchange rate appreciation associated with fund flows is higher.
Original languageEnglish
Pages (from-to)31-48
Number of pages18
JournalOpen Economies Review
Issue number1
Early online date19 Oct 2017
Publication statusPublished - Feb 2018


  • International fund flows
  • Exchange rate
  • Exchange rate regime
  • Dynamic panel data model


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