Foreign exchange expectations, overconfidence, central banks' foreign exchange interventions, financial development, risk attitudes. - Wechselkurserwartungen, Selbstüberschätzung, Wechselkursinterventionen von Zentralbanken, Entwicklung von Finanzmärkten, Risikoeinstellung

The high-frequency analysis of foreign exchange dynamics is helpful in order to better identify the impact of central bank interventions. Evidence robustly shows that interventions do indeed move the exchange rate level in the desired direction. Interventions increase volatility in the short run...

How is it possible that exchange rates move in the long run towards fundamentals, whileprofessionals form consistently irrational exchange rate expectations? We look at this puzzle from adifferent perspective by analyzing investor sentiment in the US-dollar market. First, long-horizonregressions...