scholarly journals Monetary and Fiscal Policy Under Nonlinear Exchange Rate Dynamics

1991 ◽  
Author(s):  
Carl Chiarella
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Exchange Rate Dynamics ◽  
Monetary And Fiscal Policy

scholarly journals Bond Convenience Yields and Exchange Rate Dynamics

2020 ◽  
Vol 12 (2) ◽  
pp. 124-166 ◽  
Author(s):  
Rosen Valchev
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Impulse Response ◽  
Direct Evidence ◽  
Uncovered Interest Parity ◽  
Convenience Yield ◽  
Endogenous Fluctuations ◽  
Exchange Rate Dynamics ◽  
Interest Parity ◽  
Monetary And Fiscal Policy

This paper proposes a new explanation for the failure of Uncovered Interest Parity (UIP) that rationalizes both the classic UIP puzzle and the evidence that the puzzle reverses direction at longer horizons. In the model, excess currency returns arise as compensation for endogenous fluctuations in bond convenience yield differentials. Due to the interaction of monetary and fiscal policy, the impulse response of the equilibrium convenience yield is nonmonotonic, which generates the reversal of the puzzle. The calibrated model fits exchange rate dynamics very well. I also find direct evidence linking convenience yields to excess currency returns. (JEL E43, E52, F31, F41, H63)

Fiscal Policy, Expectations, and Exchange-Rate Dynamics

1994 ◽  
Vol 2 (1) ◽  
pp. 50-61
Author(s):  
Jay H. Levin
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Exchange Rate Dynamics

The Specification of Money Demand, Fiscal Policy, and Exchange Rate Dynamics

1997 ◽  
Vol 19 (1) ◽  
pp. 79-102 ◽  
Author(s):  
Wen-Ya Chang ◽  
Ching-Chong Lai
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Money Demand ◽  
Exchange Rate Dynamics

Debt dollarisation poses dilemmas in Argentina

2016 ◽  
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Interest Rates ◽  
Policy Support ◽  
Economic Downturn ◽  
External Shocks ◽  
Content Type ◽  
The Exchange Rate ◽  
Monetary And Fiscal Policy

Subject Monetary, fiscal and debt concerns. Significance After falling to nearly 16 pesos/dollar in early March, the exchange rate stabilised, mainly due to rising domestic interest rates, which climbed to a peak of 38.0%. Monetary tightening and the deepening of the economic downturn helped to bring down inflation, which is expected to reach a monthly rate of 1.5% in the last quarter. Lower interest rates and decreasing inflation are needed to drive an economic rebound, key to the government's prospects in October 2017 mid-term elections. Impacts Dollarisation of financial liabilities will leave the economy more vulnerable to negative external shocks. The economy may show further decline in third-quarter figures. Moderating inflation and monetary and fiscal policy support are expected to help turn growth positive in 2017.

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