The purpose of this study is to estimate the effects of Real Effective Exchange Rate (REER) on Sudan trade balance (TB). The present situation is confusing for all in Sudan with discrepancies in market effective foreign currencies and government declared prices. For example, one US$ in the...

This paper considers the effect of currency union on exchange rate volatility. At a theoretical level, a simple framework is developed for thinking about volatility and exchange rate arrangements and some inferences are drawn from it. Empirically, the interaction between currency areas and...

Previous studies have mainly used reports in the financial press to analyze the link between the interventions of the Bank of Japan (BoJ) and exchange rate volatility. We use official intervention data for the period 1993 - 2000 that were released only recently by the BoJ and find that...

This paper finds that limited exchange rate flexibility in the form of "fear of appreciation" significantly slows adjustment of current account imbalances, providing novel support for Friedman's conjecture regarding exchange-rate flexibility. We present a new stylized fact: floaters have faster...

Frequent, yet uninformed, fund flows in Chilean pension plans generate substantial trading in currency markets due to the high allocation to international securities. These non-fundamental flows have a significant impact on the Chilean peso, which is estimated to have a relatively low price...

The US dollar has been the world's dominant reserve currency for decades, but its future is uncertain amid concerns about inflation, economic instability, and geopolitical tensions. One proposed solution to these challenges is to return to a gold-backed currency, which would provide a stable...

In this paper we test for the short-term impact of foreign exchange intervention on both the level of the yen/dollar exchange rate and the volatility in the yen/dollar markets. Using newly released data on Japanese foreign exchange intervention, our global GARCH estimation suggests that Japanese...

This paper offers a possible theoretical rationale ? currently lacking -- for the proposition that intermediate exchange rate regimes are no longer viable. According to this proposition, countries are being pushed to the "corners," the extremes of either free floating or firm fixing. We...

This paper investigates the role of external balance sheet variables as determinants of currency crises in emerging market (EME) and advanced economies. A random effect probit model is used in a panel of 40 countries with monthly data over the January 1980-December 2004 period. The main results...

This paper examines the regime changes in the European Exchange Rate Mechanism (ERM), by applying the duration model approach to quarterly data of eight currencies participating in the ERM, covering the complete European Monetary System (EMS) history. We first make use of the nonparametric...