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Effects of Exchange Rates and Oil Prices on Turkish Foreign Trade

M.Büşra ENGİN ÖZTÜRK
Işın KIRIŞKAN

Abstract
Exchange rate and oil prices play an important role in a country’s trade performance. Whether determined by exogenous shocks or by a policy, the relative valuations of currencies and their volatility often have important impact on international trade, the balance of payments and overall economic performance. This study aims to analyze Turkey’s foreign trade with Euro Area and USA separately between 2010-2016 time periods. We have estimated three different regressions. First one is for analyzing the effects of euro on Turkey-Euro area foreign trade, the second one is for determining the effects of US dollar on Turkey-USA foreign trade and the third one is for examining the effects of oil prices on oil trade between Turkey and Russia. For this study we use the panel regression techniques. As a result we can conclude that countries should monitor their exchange rate relative not only to that of their trading partners but also in relation to that of their competitors.
Keywords: Exchange Rate, Oil Prices, Foreign Trade, Panel Data, Panel Estimation Techniques

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