In this paper, we analyse the effect of unconventional monetary policies on the EUR/CHF exchange rate. We apply the synthetic control approach to four events defining a change in the Swiss National Bank's monetary policy during the 2009 to 2011 period before the introduction of the exchange rate...

We build a two-country model with imperfect financial intermediation. Banks face limits to arbitrage which lead to positive excess returns in the investment markets and a risk premium in the international credit market. Gross capital flows affect the exchange rate since banks are balance sheet...