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The failure of covered interest parity (CIP), or, equivalently, the persistence of the cross currency basis, in tranquil markets has presented a puzzle. Focusing on the basis against the US dollar (USD), we show that the CIP deviations that are not due to transaction costs or bank credit risk...
Persistent link: https://www.econbiz.de/10012980373
Persistent link: https://www.econbiz.de/10011609852
The failure of covered interest parity (CIP), or, equivalently, the persistence of cross-currency basis, in tranquil markets has posed a puzzle. By analysing the term structure of CIP deviations, we empirically establish that imbalances in the demand for and supply of FX hedges exert first order...
Persistent link: https://www.econbiz.de/10012934751
Persistent link: https://www.econbiz.de/10013500542
Do public policy signals improve the alignment of market outcomes with economic fundamentals? Existing work contends that, when individual players have an incentive to coordinate their actions, public policy signals could steer these actions away from the fundamentals. We argue that such a...
Persistent link: https://www.econbiz.de/10014165943
What is the role for supply and demand forces in determining movements in international banking flows? Answering this question is crucial for understanding the international transmission of financial shocks and formulating policy. This paper addresses the question by using the method developed...
Persistent link: https://www.econbiz.de/10012953512
What is the role of supply and demand forces in determining movements in international banking flows? Answering this question is crucial for understanding the international transmission of financial shocks and formulating policy. This paper addresses the question by using the method developed in...
Persistent link: https://www.econbiz.de/10012953793
What is the role for supply and demand forces in determining movements in international banking flows? Answering this question is crucial for understanding the international transmission of financial shocks and formulating policy. This paper addresses the question by using the method developed...
Persistent link: https://www.econbiz.de/10012955333
What is the role for supply and demand forces in determining movements in international banking flows? Answering this question is crucial for understanding the international transmission of financial shocks and formulating policy. This paper addresses the question by using the method developed...
Persistent link: https://www.econbiz.de/10012955709
What is the role for supply and demand forces in determining movements in international banking flows? Answering this question is crucial for understanding the international transmission of financial shocks and formulating policy. This paper addresses the question by using the method developed...
Persistent link: https://www.econbiz.de/10012955840