scholarly journals Exchange rate dynamics, structural breaks, and central bank interventions in Colombia

2015 ◽  
Vol 19 (41) ◽  
pp. 24-44
Author(s):  
Jorge Uribe ◽  
◽  
Natalia Restrepo ◽  
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Structural Breaks ◽  
Exchange Rate Dynamics ◽  
Central Bank Interventions

scholarly journals An Interpretation of Recent Research on Exchange Rate Target Zones

1992 ◽  
Vol 6 (4) ◽  
pp. 119-144 ◽  
Author(s):  
Lars E. O Svensson
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Exchange Rates ◽  
Interest Rates ◽  
Empirical Research ◽  
Target Zones ◽  
The Difference ◽  
Exchange Rate Target Zones ◽  
Main Ideas ◽  
Central Bank Interventions

How do exchange rate bands work compared to completely fixed rates (between realignments); or, more precisely, what are the dynamics of exchange rates, interest rates, and central bank interventions within exchange rate bands? Does the difference between bands and completely fixed exchange rates matter, and if so, which of the two arrangements is best; or, more precisely, what are the tradeoffs that determine the optimal bandwidth? This article will present an interpretation of some selected recent theoretical and empirical research on exchange rate target zones, with emphasis on main ideas and results and without technical detail.

scholarly journals Monetary Response to Exchange Rate Dynamics: Regime Switching – Chartists and Fundamentalists Application to Australia

2013 ◽  
Author(s):  
Ferry Syarifuddin
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Empirical Evidence ◽  
Regime Switching ◽  
Rate Model ◽  
Central Bank Intervention ◽  
Exchange Rate Dynamics ◽  
Reserve Bank ◽  
Stabilizing Effect ◽  
Exchange Rate Intervention

In this paper we study the effect of central bank intervention within a heterogeneous expectations exchange rate model. The empirical evidence is conducted by applying a Markov switching approach to daily AUD/USD exchange rate, intervention data of the Reserve Bank of Australia from 2006 to 2012. Our results are supporting both chartists and fundamentalist regimes. It is shown that the two regimes are persistent. However, Reserve Bank of Australia efforts to exert a stabilizing effect of foreign exhange interventions, the result is inconclusive.

scholarly journals Remodelling Macroeconomic Trilemma and Central Bank Behaviour in Nigeria: A Markov-Switching Approach

2020 ◽  
Author(s):  
Taofeek Olusola AYINDE ◽  
BANKOLE Abiodun S.
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Structural Breaks ◽  
Exchange Rate Regime ◽  
Markov Switching ◽  
Unit Root Test ◽  
Monetary Authority ◽  
Policy Variable ◽  
Bank Behavior ◽  
The Exchange Rate

Abstract This study investigates macroeconomic trilemma and Central Bank behavior in Nigeria. The period of investigation spans the quarterly period of 1981–2017. Upon the data stability condition of Zivot-Andrew unit-root test with structural breaks, the Markov Switching Dynamic Regression was employed as the technique of analysis. With a validated trilemma hypothesis, the study found that the trilemma constraints hold for the Nigerian economy but at the expense of the autonomy of the monetary authority. Being the policy variable of the Central Bank of Nigeria, the exchange rate was found to follow two regimes of fixed and managed-float regimes. The results also showed that political risk was found insensitive to the regimes of exchange rate while the foreign sector was considered as a moderating factor for the behavior of the monetary authority; irrespective of the exchange rate regime.JEL Classifications: F41, E32, E52, C22, E58.

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