Currency substitution appears to be an important issue affecting the design of monetary policy, especially in transition economies. Therefore, this paper strives to analyse the particular relevance of the currency substitution phenomenon in the Czech Republic’s case. We initially discuss...

This is a study of what asset price can tell us about the evolving credibility of the monetary policy of the Czech National Bank (CNB). From the beginning of the 1990s, several market economies adopted direct inflation targeting (DIT). The focus of our analysis is to examine the effect of...

This paper strives to enlarge the traditional form of money demand for closed economy with some additional foreign or international determinants. These are, according to presented theory of currency substitution, nominal exchange rate CZK/DEM (or CZK/USD) and yield of foreign assets (3M LIBOR on...