Iceland - Real effective exchange rate index (2010 = 100)

The value for Real effective exchange rate index (2010 = 100) in Iceland was 125.70 as of 2021. As the graph below shows, over the past 42 years this indicator reached a maximum value of 156.98 in 2005 and a minimum value of 96.68 in 2009.

Definition: Real effective exchange rate is the nominal effective exchange rate (a measure of the value of a currency against a weighted average of several foreign currencies) divided by a price deflator or index of costs.

Source: International Monetary Fund, International Financial Statistics.

See also:

Year Value
1979 139.44
1980 146.60
1981 152.87
1982 140.20
1983 129.71
1984 138.33
1985 137.08
1986 136.74
1987 147.86
1988 155.55
1989 142.23
1990 141.00
1991 143.95
1992 144.31
1993 133.47
1994 125.47
1995 125.16
1996 125.38
1997 127.61
1998 131.94
1999 133.47
2000 137.24
2001 120.22
2002 127.69
2003 135.95
2004 140.06
2005 156.98
2006 145.74
2007 153.64
2008 120.24
2009 96.68
2010 100.00
2011 100.92
2012 99.83
2013 104.04
2014 111.19
2015 114.03
2016 128.32
2017 143.67
2018 139.92
2019 130.57
2020 120.68
2021 125.70

Development Relevance: In a market-based economy, household, producer, and government choices about resource allocation are influenced by relative prices, including the real exchange rate, real wages, real interest rates, and other prices in the economy. Relative prices also largely reflect these agents' choices. Thus relative prices convey vital information about the interaction of economic agents in an economy and with the rest of the world.

Limitations and Exceptions: Because of conceptual and data limitations, changes in real effective exchange rates should be interpreted with caution.

Statistical Concept and Methodology: The real effective exchange rate is a nominal effective exchange rate index adjusted for relative movements in national price or cost indicators of the home country, selected countries, and the euro area. A nominal effective exchange rate index is the ratio (expressed on the base 2010 = 100) of an index of a currency's period-average exchange rate to a weighted geometric average of exchange rates for currencies of selected countries and the euro area. For most high-income countries weights are derived from industrial country trade in manufactured goods. Data are compiled from the nominal effective exchange rate index and a cost indicator of relative normalized unit labor costs in manufacturing. For selected other countries the nominal effective exchange rate index is based on manufactured goods and primary products trade with partner or competitor countries. For these countries the real effective exchange rate index is the nominal index adjusted for relative changes in consumer prices; an increase represents an appreciation of the local currency.

Base Period: 2010

Periodicity: Annual

Classification

Topic: Financial Sector Indicators

Sub-Topic: Exchange rates & prices