This paper develops a stochastic equilibrium model of an open economy incorporating speculation in the forward exchange … and forward exchange marketbut exacerbates the effect of foreign disturbances. Speculation may dampen or augment the … interest elasticity of bond demand. The second issue that the model addresses is the role of the forward market in …

mandate, market participants have the option to trade currency futures on existing futures markets which standardize …

, we provide a general explanation of this turbulence in terms of the modern "asset market theory" to exchange …-rate determination. This theory emphasizes that exchange rates, like the prices of other assets determined in organized markets, are …

We present theory and evidence that challenges the view that forward premia contain little information regarding … subsequent spot rate movements. Using weekly dollar-mark and dollar sterling data, we find that spot and forward exchange rates … relationships predicted by a simple theoretical framework and that a basis for this cointegrating space is the vector of forward …

by policy responses. This paper presents a theory-based measure of capital flow pressures, a new Exchange Market Pressure …