Menkhoff, Lukas; Rebitzky, Rafael R. - Universität <Hannover> / Wirtschaftswissenschaftliche … - 2007
How is it possible that exchange rates move in the long run towards fundamentals, whileprofessionals form consistently irrational exchange rate expectations? We look at this puzzle from adifferent perspective by analyzing investor sentiment in the US-dollar market. First, long-horizonregressions...