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The Effects of Conventional and Unconventional Monetary Policy on Exchange Rates
Inoue, Atsushi - 2018
affect agents' expectations; (iii) we find favorable evidence to Dornbusch's (1976) overshooting hypothesis …
Persistent link: https://www.econbiz.de/10012911113
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Activist Monetary Policy and Exchange Rate Overshooting : the Deutsche Mark/Dollar Rate
Papell, David H. - 2021
exchange rate determination. Dornbush's over-shooting hypothesis is the best known explanation of this phenomenon. This paper … exchange rate overshooting to undershooting. Using constrained maximum likelihood methods, the model is estimated for Germany … and the United States. The results provide strong evidence in support of the overshooting hypothesis for the Deutsche Mark …
Persistent link: https://www.econbiz.de/10013234404
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Puzzling Exchange Rate Dynamics and Delayed Portfolio Adjustment
Bacchetta, Philippe - 2019
) the delayed overshooting puzzle; ii) the forward discount puzzle (or Fama puzzle); iii) the predictability reversal puzzle …
Persistent link: https://www.econbiz.de/10012862857
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Exchange Rate Dynamics and the Overshooting Hypothesis
Frenkel, Jacob A.; Rodriquez, Carlos - 2022
of exchange rate dynamics. We examine the overshooting hypothesis in models which emphasize differential speeds of … exchange rate overshooting is not an intrinsic characteristic of the foreign exchange market and that it depends on a set of … specific assumptions. We also show that the overshooting is not a characteristic of the assumption of perfect foresight nor …
Persistent link: https://www.econbiz.de/10013324489
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Inflation Announcements and Social Dynamics
Hachem, Kinda - 2014
We propose a new framework for understanding the effectiveness of central bank announcements when firms have heterogeneous inflation expectations. Expectations are updated through social dynamics and, with heterogeneity, not all firms choose to operate, putting downward pressure on realized...
Persistent link: https://www.econbiz.de/10013053470
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Exchange Rates and Local Labor Markets
Goldberg, Linda S.; Tracy, Joseph S. - 2000
We document the consequences of real exchange rate movements for the employment, hours, and hourly earnings of workers in manufacturing industries across individual states. Exchange rates have statistically significant wage and employment implications in these local labor markets. The importance...
Persistent link: https://www.econbiz.de/10014193865
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Risk, Monetary Policy and the Exchange Rate
Benigno, Gianluca - 2011
In this research, we provide new empirical evidence on the importance of time-varying uncertainty for the exchange rate and the excess return in currency markets. Following an increase in monetary policy uncertainty, the dollar exchange rate appreciates in the medium run, while an increase in...
Persistent link: https://www.econbiz.de/10013123697
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Relaxing the External Constraint : Europe in the 1930s
Eichengreen, Barry - 2011
This paper documents the effects of exchange rates and the external constraint during the interwar years. In the absence of international policy coordination, exchange rate depreciation is shown to have been a necessary precondition for the adoption of policies promoting recovery from the Great...
Persistent link: https://www.econbiz.de/10013125958
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Financial Intermediation, Exchange Rates, and Unconventional Policy in an Open Economy
Cespedes, Luis Felipe - 2012
This paper develops an open economy model in which financial intermediation is subject to occasionally binding collateral constraints, and uses the model to study unconventional policies such as credit facilities and foreign exchange intervention. The model highlights the interaction between the...
Persistent link: https://www.econbiz.de/10013099827
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Monetary Policy and the Predictability of Nominal Exchange Rates
Eichenbaum, Martin - 2017
This paper studies how the monetary policy regime affects the relative importance of nominal exchange rates and inflation rates in shaping the response of real exchange rates to shocks. We document two facts about inflation-targeting countries. First, the current real exchange rate predicts...
Persistent link: https://www.econbiz.de/10012963169