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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (479)	1/5/1998 2:15:00 PM
From: Geoff Nunn	Read Replies (1) \| Respond to of 9980

Yiwu, I'm not a specialist in the field. My impression though is that price indexes for each country are computed on internationally traded goods, i.e., exact same goods which can be bought in either country. These indexes are then used as a kind of theoretical, equilibrium exchange rate. I don't know how the individual goods would be weighted but would guess domestic consumption patterns in each country would be an important consideration. I'm sure there are others on this thread who can tell you more than I. Geoff