The relatively low exchange-rate pass-through for imports from Japan is consistent with
the study by Parsons and Sato (2008), which found that PTM behavior among Japanese exports is
common for exports to the United States. Most of the exchange rate pass-through for Japan is was
found to take place in the first and second quarters. The non-existent exchange-rate pass-through
found for the NIEs is consistent with the study by Fukuda and Ono (2004) which showed that
East Asian countries tend to set their export prices in dollars across export markets. The estimated
exchange-rate pass-through of 0.26 for the EU seems reasonable–the coefficient is lower than that
of Latin America (Mexico) and Canada, whose economies are highly integrated with that of the
United States, but higher than the estimates for Japan and the NIE’s where PTM behavior is
common.