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Exchange Rate Policies for the EFTA Countries in the 1990s

Branson, William H - C.E.P.R. Discussion Papers - 1991

As the European Community (EC) unifies its financial markets and fixes its exchange rates, the EFTA countries are liberalizing capital movements to the same extent. The EFTA countries thus face a decision on financial markets and exchange rate policy: should they essentially join the European...

Persistent link: https://www.econbiz.de/10005504364

Exchange Rates Dynamics with Long-Run Risk and Recursive Preferences

Kollmann, Robert - C.E.P.R. Discussion Papers - 2014

, then long-run risk generates insufficient exchange rate volatility. A longrun risk model with recursive-preferences in … which all agents trade in complete global financial markets can generate realistic exchange rate volatility; however, I show … the remaining households lead hand-to-mouth lives, generates realistic exchange rate and external balance volatility …

Persistent link: https://www.econbiz.de/10011084256

Dollar Illiquidity and Central Bank Swap Arrangements During the Global Financial Crisis

Rose, Andrew K; Spiegel, Mark - C.E.P.R. Discussion Papers - 2011

While the global financial crisis was centered in the United States, it led to a surprising appreciation in the dollar, suggesting global dollar illiquidity. In response, the Federal Reserve partnered with other central banks to inject dollars into the international financial system. Empirical...

Persistent link: https://www.econbiz.de/10009293988

Monetary Policy in an Estimated Open-Economy Model with Imperfect Pass-Through

Lindé, Jesper; Nessen, Marianne; Söderström, Ulf - C.E.P.R. Discussion Papers - 2004

We develop a structural model of a small open economy with gradual exchange rate pass-through and endogenous inertia in inflation and output. We then estimate the model by matching the implied impulse responses with those obtained from a VAR model estimated on Swedish data. Although our model is...

Persistent link: https://www.econbiz.de/10005123761

The Behaviour of Relative Prices in the European Union: A Sectoral Analysis

Chen, Natalie - C.E.P.R. Discussion Papers - 2002

cross-sectoral characteristics such as the distance between countries, nominal exchange rate volatility, differences in GDP …

Persistent link: https://www.econbiz.de/10005504281

Credible Commitment to Optimal Escape from a Liquidity Trap: The Role of the Balance Sheet of an Independent Central Bank

Jeanne, Olivier; Svensson, Lars E O - C.E.P.R. Discussion Papers - 2004

An independent central bank can manage its balance sheet and its capital so as to commit itself to a depreciation of its currency and an exchange-rate peg. This way, the central bank can implement the optimal escape from a liquidity trap, which involves a commitment to higher future inflation....

Persistent link: https://www.econbiz.de/10005504755

The Zero Bound in an Open Economy: A Foolproof Way of Escaping from a Liquidity Trap

Svensson, Lars E O - C.E.P.R. Discussion Papers - 2000

The paper examines the transmission mechanism of monetary policy in an open economy with and without a binding zero bound on nominal interest rates. In particular, a foolproof way of escaping from a liquidity trap is suggested, consisting of a price-level target path, a devaluation of the...

Persistent link: https://www.econbiz.de/10005497818

Why do Consumer Prices React Less than Import Prices to Exchange Rates?

Bacchetta, Philippe; van Wincoop, Eric - C.E.P.R. Discussion Papers - 2003

It is well known that the extent of pass-through of exchange rate changes to consumer prices is much lower than to import prices. One explanation is local distribution costs. Here we consider an alternative, complementary explanation based on the optimal pricing strategies of firms. We consider...

Persistent link: https://www.econbiz.de/10005498013

The Real Exchange Rate in Transition Economies

Grafe, Clemens; Wyplosz, Charles - C.E.P.R. Discussion Papers - 1997

Real exchange rates appear to present a specific behaviour in the early phase of transition: they are largely unaffected by nominal exchange rate movements and exhibit trend appreciation. The model presented here describes the transition process as the emergence of two new (traded and non-traded...

Persistent link: https://www.econbiz.de/10005498147

Exchange Rate Forecasting, Order Flow and Macroeconomic Information

Rime, Dagfinn; Sarno, Lucio; Sojli, Elvira - C.E.P.R. Discussion Papers - 2009

This paper adds to the research efforts that aim to bridge the divide between macro and micro approaches to exchange rate economics by examining the linkages between exchange rate movements, order flow and expectations of macroeconomic variables. The basic hypothesis tested is that if order flow...

Persistent link: https://www.econbiz.de/10004972168