Okuzeka
Economics vocabulary · Inflation and Prices

Pass-through

Meaning in economics, with examples

nounAdvanced term

In economics, pass-through means: The degree to which a change in costs, especially in the exchange rate, is passed on to consumer prices.

In Turkish: geçişkenlik, kur geçişkenliği, yansıma

How it is used

Usually exchange rate pass-through: when the currency weakens, import prices rise and part of this shows up in inflation. Pass-through can be high or low, fast or slow, and tends to be higher where inflation is already high. The phrasal verb is pass on: firms pass on costs.

Example sentences

  1. Economists estimate that pass-through from the exchange rate to inflation is about 20%.

  2. Exchange rate pass-through is faster when inflation is already high.

Common collocations

  • exchange rate pass-through
  • high pass-through
  • pass-through to inflation
  • pass on costs
  • exchange rateThe price of one currency expressed in another, for example how many Turkish lira you need to buy one US dollar or one euro.
  • depreciationA fall in the value of a currency against other currencies under a floating exchange rate, driven by market forces rather than an official decision.
  • cost-push inflationInflation caused by rising production costs, such as higher energy prices, wages or import costs, which firms pass on to their customers.
  • importA good or service bought from producers in another country; as a verb, to bring goods or services in from abroad.
  • producer price indexA measure of the average change in the prices that domestic producers get for their goods at the factory gate, before taxes and shop margins are added.

More terms: Inflation and Prices

Practise with graded reading

Reading at the right level is the fastest way to make new words stick. Pick free English books by level:

This page explains English vocabulary for learners. It is not financial advice.