Effect of exchange rate volatility on some macroeconomic indicators: An analysis for the Turkey's economy

The effects of uncertainty on economic decisions are examined theoretically and empirically. For the uncertainty measure in this study; Exchange rate volatility was chosen as the standart deviation and its effect on growth, export, import, investment, consumption variables was investigated. In the study on the economy of turkey 2013:1- 2018:4 quarterly data are utilized to 4 periods. Simple regression analysis and granger causality analysis are performed. It is concluded that exchange rate volatility negatively affects investment, import andconsumptionfor the whole period of 2013:1-2018:4. However, an unusual move was observed in the exchange rate in 2018. When 2018 was excluded, there was no statistically significant causal relationship. According to the result of exchange rate volatility in Turkey with nominal growth in the period under review, exports, imports, investment and consumption on the decisive variables could not be reached to the conclusion that any impact. Therefore, the notion that a fixed exchange rate system can benefit from the Turkish economy or that a flexible exchange rate system may have a negative effect has not been supported. Keywords: Exchange Rate Volatility, Regression Analysis, Granger Causality Analysis, Growth, Import, Export, Investment, Consumption, Turkey