Showing 1 - 10 of 6,420
A number of empirical studies have reported the result that exchange rates show a delayed overshooting in response to … monetary policy shocks. This result is puzzling. Economic theory suggests that the overshooting should occur immediately after … whether the assumption of noise trading in the foreign exchange market helps to resolve the delayed overshooting puzzle. The …
Persistent link: https://www.econbiz.de/10010260546
While exchange rate dynamics is an important topic in open economy macroeconomics, the standard tool commonly used to introduce exchange rate dynamics - the Dornbusch (1976) seminal paper along with phase diagram - is not well-suited for undergraduate students as most of them do not have yet a...
Persistent link: https://www.econbiz.de/10010422230
- empirical support for his hypothesis is at best mixed. I argue that the failure to discover overshooting may result from …
Persistent link: https://www.econbiz.de/10012124364
vector autoregression, and assess whether best-practice structural identifications detect textbook "overshooting" after a … monetary policy hike-i.e., an instant real appreciation that monotonically reverts. Our results include "delayed overshooting …," "exchange rate puzzles," "forward discount puzzles," and model-consistent overshooting. Identifications that regularly indicate …
Persistent link: https://www.econbiz.de/10015069881
Understanding and predicting the evolution of exports after a change in the nominal exchange rate is of central importance in international economics. Most of the literature focuses on estimating this relationship by reduced form, with the aim of uncovering a single structural parameter, but...
Persistent link: https://www.econbiz.de/10013172465
can give rise to a delayed overshooting of the exchange rate. …
Persistent link: https://www.econbiz.de/10010260479
Results of empirical research have revealed a characteristic hump-shaped effect of monetary policy shocks on output: the effect builds to a peak after several months and then gradually dies out. We analyze, in the context of a "new open economy macroeconomics" model, factors that imply a hump-...
Persistent link: https://www.econbiz.de/10010260498
Past empirical research on monetary policy in open economies has found evidence of the 'delayed overshooting', the …
Persistent link: https://www.econbiz.de/10003147640
In this paper, we reconsider the question how monetary policy influences exchange rate dynamics. To this end, a vector autoregressive (VAR) model is combined with a two-country dynamic stochastic general equilibrium (DSGE) model. Instead of focusing exclusively on how monetary policy shocks...
Persistent link: https://www.econbiz.de/10012118186
. The main finding of the paper is a ‘delayed overshooting’ pattern for all currency cross rates examined (sterling/yen, yen … provide evidence that the ‘delayed overshooting’ pattern in cross exchange rates is accompanied by asymmetric interventions by …
Persistent link: https://www.econbiz.de/10014080544