economies (EMEs) on configurations between the US dollar, the euro and the yen. Given the difficulty that fixed or managed US … have a statistically but also an economically significant impact on the euro, and to a lesser extent the yen against the US … the appreciation of the euro against the US dollar in recent years. Interestingly, EME policy-makers appear to have become …

, Czech Republic and Hungary vis-à-vis the euro and the US dollar to estimate the risk-neutral density (RND) functions and the …

correlations. We then apply the correlation forecasts to two policyrelevant topics, to produce scenario analyses for the euro …We compare option-implied correlation forecasts from a dataset consisting of over 10 years of daily data on over … correlation forecasts. We find that while the predictive power of implied correlation is not always superior to that of returns …

outperform a random walk with statistical significance. While one finds that these forecasts are cointegrated with the actual … values of exchange rates, in most cases, the elasticity of the forecasts with respect to the actual values is different from …