Impact of Exchange Rates of Japan, South Korea and Singapore on GDP

In recent years, many studies regarding the relationship between gross domestic product (GDP) and exchange rates have found that the fluctuations of exchange rates have different influence in different economic systems. This study adopts the Locally Weighted Regression (LWR) method to explore the dynamic relationship between exchange rates and GDP in three East Asian economies, namely Japan, South Korea, and Singapore. By analyzing the annual statistic figures from 1990 to 2024, this paper is intended to reveal the local impact of exchange rate fluctuations on GDP growth and compare the similarities and differences in the relationship between exchange rates and GDP under different economic environments. In conclusion, the exchange rate and GDP of Japan has the strongest connection. Next is the Singapore. South Koreas exchange rates have the weakest correlation with GDP. This result may be caused by the economic structure, policies, trading partners, and various other factors. This study may give people a deeper insight into the difference of economic policies in Japan, South Korea and Singapore.