We propose a new exchange rate model using IRD time series as the input, and we fit the new model with empirical data for calibration. We assume that exchange rate modeling cannot be based on the response to a single shock but must instead be based on the response to a series of shocks, as...

In this paper, we analyse nominal exchange rate and price dynamics after risk shocks with short-term interest rates constrained by the zero lower bound (ZLB). We show with a stylized theoretical model that temporary risk shocks may lead to permanent shifts of the exchange rate and the price...

In this paper we examine the effect of monetary policy on the Israeli economy, and in particular on unemployment and the evolution of prices, for the period between 1990 and 1999, using the SVAR methodology. The four endogenous variables are the unemployment rate in deviations from its trend,...