Adaptation to Composite Basket Pegging in African Countries

bibliographic database
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Periodical article

Title:	Adaptation to Composite Basket Pegging in African Countries
Author:	Mullei, Andrew K.
Year:	1990
Periodical:	Eastern Africa Economic Review
Volume:	6
Issue:	1
Pages:	1-9
Language:	English
Notes:	biblio. refs., ills.
Geographic terms:	Africa Kenya
Subjects:	monetary policy exchange rates Economics and Trade Economics, Commerce currencies Convertibility international monetary relations Foreign exchange rates
Abstract:	This paper discusses the technical difficulties associated with adopting a 'tailor-made' basket pegging in African countries under the prevailing generalized floating of the major currencies. Following an explanation of the choice of which currencies to include in a basket and what weights to assign to them, the author develops a framework for the implementation of a currency composite index capable of achieving international competitive value for domestic currency. The evolving relationship between a given currency and the basket currencies is also shown using the data and calculations of a trade-weight index for the Kenya shilling. Bibliogr., notes, ref.