Standard economic models hold that exchange rates are influenced by fundamental variables such as relative money supplies, outputs, inflation rates and interest rates. Nonetheless, it has been well documented that such variables little help predict changes in floating exchange rates u0097 that...

The Euro-area now has a single monetary policy, administered by the European Central Bank. The succedss of such a 'one policy fits all' system depends in part on the mechanisms by which decisions on interest rates, etc. affect the real economy. This study examines various differences between...