Depreciation of exchange rate boosts Ethiopian economy, study finds.
The study looked at how the value of money in Ethiopia affects the country's trade balance. They used data from 1976 to 2015 and found that changes in the real effective exchange rate can impact the current account in both the short and long term. When the exchange rate goes down, the trade balance initially gets worse before improving, following a J-curve pattern. This suggests that lowering the exchange rate could help boost exports and reduce imports in Ethiopia.