This empirical research explores the interaction between the overnight currency swap rates (Turkish lira rates) and BIST overnight repo rates. In this context, the derived no arbitrage condition reveals that the differential between the two rates is determined by Libor, financial institutions’...

The monetary authorities of emerging market economies tend to emphasize the studies that find instabilities in the money demand functions and use them as the main pretext for formulating monetary policy strategies in which monetary aggregates play no prominent role. In this study, however, we...