IMF Staff papers : Volume 31 No. 3.
This paper highlights exchange rate movements and adjustment in financial markets. This paper develops a model of portfolio behavior in which it is assumed that market participants act as if they always expected exchange rates to move in line with expected inflation differentials. In the solution of...
| Autor Corporativo: | |
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| Formato: | Revista |
| Idioma: | English |
| Publicado: |
Washington, D.C. :
International Monetary Fund,
1984.
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| Series: | IMF Staff Papers; IMF Staff Papers ;
No. 1984/003 |
| Acceso en liña: | Full text available on IMF |
| Summary: | This paper highlights exchange rate movements and adjustment in financial markets. This paper develops a model of portfolio behavior in which it is assumed that market participants act as if they always expected exchange rates to move in line with expected inflation differentials. In the solution of this model, exchange rate movements are determined by real interest rate differentials and the cumulated balance of external payments. Two important empirical features distinguish this model from most other models based on the asset-market approach to exchange rate determination. The paper gives evidence that comparisons between these estimates and alternative models broadly support the model developed here. A principal conclusion is that interest rate differentials do have a clearer short-run relationship to exchange rate changes than to exchange rate levels. |
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| descrición da copia: | <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required |
| Descrición Física: | 1 online resource (151 pages) |
| Formato: | Mode of access: Internet |
| ISSN: | 1020-7635 |
| Acceso: | Electronic access restricted to authorized BRAC University faculty, staff and students |