During the 1990s the United Kingdom experienced large and sudden exchange rate movements that had no apparent impact on overall consumer prices. This paper shows that the stability of U.K. consumer prices was made possible in part by offsetting movements in the price-cost margins of foreign...

We discuss the evolution in macroeconomic thought on the monetary policy transmission mechanism and present related empirical evidence. The core channels of policy transmission — the neoclassical links between short-term policy interest rates, other asset prices such as long-term interest...

We find that domestic currency, currency corrected for foreign holdings, has a substantial share in forecast error variance decomposition of US inflation. We also find that domestic currency has higher share of the forecast error variance decomposition of US real output than any other narrow...

Volatility of Rupiah's exchange rate to Foreign Currency in 2015 was indicated by Rupiah's depreciation. The purpose of this paper is to see how the implementation of mandatory use of Rupiah in Indonesia affects factors that cause its depreciation. In this paper, descriptive analysis and...

The principles that govern the financial markets and goods market are some what identical. Based on demand supply, constant exchanges takes place in both the markets. In a way which we view and understand goods market, the same approach is being used for understanding financial markets wherein...

We propose a two-step approach to estimate multi-dimensional monetary policy shocks and their causal effects requiring only daily financial market data and policy events. First, we combine a heteroscedasticity-based identification scheme with recursive zero restrictions along the term structure...

The UIP equation estimated for Poland shows that the reaction of the nominal exchange rate of zloty to the expected changes of the future interest rates (appreciation) has been almost twice as high as the exchange rate reaction to disparity changes (depreciation). If the budget deficit and...