Two Prices, Two Anchors: What Links Algeria's Official And Parallel Exchange Rates?
Auteurs : Zidane Madjida . Benbouziane Mohamed .
Résumé
Algeria's dinar has two prices: an official rate managed by the central bank and a parallel rate that has been 60 to 85 per cent higher in recent years. Using 63 verified, dated parallel-market quotations for 2013-2026 matched with monthly official rates, we test five possible links between them. There is no long-run equilibrium: the two rates are not cointegrated and the parallel rate drifts upward by about 5 per cent a year on its own. Transmission is partial and one-way: within a year the street absorbs about half of an official move, and the parallel rate neither predicts nor triggers official adjustments. The anchors also differ: the official dinar follows a dollar-heavy basket, while the street prices the euro first, so swings in the euro-dollar rate move the measured premium. Premiums built from interpolated series overstate transmission. We draw implications for unification and for monitoring.
Mots clés
parallel exchange market ; black-market premium ; exchange-rate pass-through ; currency basket ; Algeria
