Revised currency baskets 2017
The weights of currencies in the baskets used to calculate the trade-weighted exchange rate indices have been updated. The weights are determined based on Iceland’s external trade in 2016. The last review was carried out at the beginning of 2017. The tables show the new baskets and the changes resulting from the review. The revised baskets will be used as of 1 January 2018 and will remain in use until the next annual review.
The weights are determined based on the composition of Iceland’s external trade during the previous year. The aim is that the baskets reflect as closely as possible the composition of Iceland’s external trade in goods and services. Currency selection is based on the three-year average of a country’s share in Iceland’s goods and services trade. The main changes from the previous baskets are as follows:
Narrow merchandise (A), narrow services (C), and narrow trade basket (E):
• The Polish złoty is added to the baskets.
Broad merchandise (B), broad services (D), and broad trade basket (F):
• The Australian dollar is added to the baskets.
• The Singapore dollar is excluded from the baskets.
In the goods trade basket, the weight of the US dollar increases markedly between years, and the weight of the pound sterling increases as well. On the other hand, the weight of the Brazilian real, the Russian ruble, and the Norwegian krone declined the most. The most significant changes in the services basket are as follows: the weight of the US dollar, euro, and Canadian dollar has increased, and the weight of the Danish krone, the Swiss franc, and the Saudi Arabian real has decreased the most. The weight of the pound sterling has also declined slightly. The trade baskets reflect these changes to a large degree. The weight of the US dollar has risen the most between years, whereas the weight of the Brazilian real, the Swiss franc, and the Danish and Norwegian krone has declined.
The tables showing the new baskets and the changes from the previous baskets can be found here:
Currency baskets 2017 (Excel)
Currency baskets 2017 (PDF)