This paper develops and estimates a game-theoretical model of inflation targeting where the central banker''s preferences are asymmetric around the targeted rate. Specifically, positive deviations from the target can be weighted more, or less, severely than negative ones in the central banker''s...

This paper examines the conjecture that an increase in tariffs in a flexible exchange rate regime leads to the appreciation of the local currency. We focus on the reaction of the exchange rate market to tweets by US President Donald Trump regarding possible tariff increases on Canadian and...