This paper analyses the link between economic fundamentals and exchange rates by investigating the importance of real …

role for macroeconomic fundamentals, policy actions and the public debate by policy makers. It finds that the euro exchange … rate mainly danced to its own tune, with a particularly low explanatory power for macroeconomic fundamentals. Among the few …

This note revisits the temporal causality between exchange rates and fundamentals put forward by Engel and West (2005 … show that, considering information content beyond one-period ahead, the causal link between exchange rates and fundamentals … is stronger than previously reported. We find Granger-causality running from exchange rates to fundamentals at some …

mechanism in foreign exchange markets. Therefore, we analyze the role of expectations regarding macroeconomic fundamentals for … fundamentals, which is not fully consistent with traditional fundamentals models. We especially highlight the relevance of the PPP …

mechanism in foreign exchange markets. We analyze the role of expectations regarding macroeconomic fundamentals for expected … expectations regarding GDP growth, inflation, interest rates, and current accounts. Our empirical findings show that fundamentals … attention to expected fundamentals. Finally, we also observe that incorporating expected fundamentals tends to reduce forecast …