Rose, Andrew K; Svensson, Lars E O - In: Scandinavian Journal of Economics 97 (1995) 2, pp. 173-200
Expected rates of devaluation for the French franc/Deutsche mark exchange rate during the EMS are estimated using the 'drift adjustment' method. Exchange rates within the band display strong mean reversion. The adjustment term, the expected rate of depreciation within the band, is often of the...