The close integration of Australian and New Zealand financial markets and the similarity of the monetary policy regimes provide the perfect backdrop for testing the empirical relevance of uncovered interest rate parity (UIP) in Oceania. We find that changes in the bilateral exchange rate have...

The close integration of Australian and New Zealand financial markets and the similarity of the monetary policy regimes provide the perfect backdrop for testing the empirical relevance of uncovered interest rate parity (UIP) in Oceania. We find that changes in the bilateral exchange rate have...

The global financial crisis and subsequent recession have highlighted the huge costs that financial imbalances can impose on an economy. Because the financial crisis was in large part the result of specific vulnerabilities in the banking sector, reform proposals are accordingly focused on...

This note analyses the relationship between actual and expected Official Cash Rate (OCR) changes and subsequent exchange rate movements. It concludes that there has been a weak positive relationship between OCR changes (or expected changes) and the currency, but that this only applies over very...