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The real effective exchange rate based on real exchange instead of nominal exchange rate in foreign currency exchange.

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14y ago

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Difference between REER and NEER?

Nominal effective exchange rate (NEER) and Real effective exchange rate (REER)


What is the difference between REER and NEER?

NEER Stands for Nominal Effective Exchange Rate and REER stands for Real Efective Exchange Rate.NEER is depends on GDP(GDP weighted NEER is more appropriate) and Trade values. REER adjusts NEER by appropriate foreign price level and deflates by the home country price level.


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