Federal Reserve Bank of Dallas

In the fourth quarter 2010 issue of Southwest Economy, Dallas Fed researchers introduced new measures of real trade-weighted exchange rates for each of the 50 U.S. states. These indexes calculate the inflation-adjusted value of the U.S. dollar against the currencies of countries with which the state trades. The real exchange rates are aggregated across countries for each state using the average export share to the country over the period from 1997 to 2009. The indexes should allow analysts to more precisely identify the exchange rate movements that most affect demand for a state’s exports.