Exchange-rate pass-through (ERPT) is a measure of how responsive international prices are to changes in exchange rates.
Formally, exchange-rate pass-through is the elasticity of local-currency import prices with respect to the local-currency price of foreign currency.
It is often measured as the percentage change, in the local currency, of import prices resulting from a one percent change in the exchange rate between the exporting and importing countries.
When exchange-rate pass-through is greater, there is more transmission of inflation between countries.
[2] Exchange-rate pass-through is also related to the law of one price and purchasing power parity.
periods is Campa and Goldberg (2005) estimated the long-run exchange-rate pass-through to import prices for the following countries, averaging across the countries from which imports came:[2] Measurement of exchange-rate pass-through is typically performed using aggregate price indexes.