Marin, Emile A.; Singh, Sanjay R. - 2023
real exchange rates when financial markets are incomplete. However, cross-border trade in one domestic and one foreign … characterize how goods markets drive exchange rate cyclicality, taking into account trade in risk-free and/or risky assets. We show … that goods-market mechanisms come back into play, even when there is cross-border trade in two risk-free assets, as long as …