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Thursday, August 6, 2020 | History

2 edition of Official intervention in the exchange markets found in the catalog.

Official intervention in the exchange markets

Helmut W. Mayer

Official intervention in the exchange markets

stablising or destabilising

by Helmut W. Mayer

  • 4 Want to read
  • 23 Currently reading

Published by Bank for International Settlements, Monetary and Economic Department in Basle .
Written in English


Edition Notes

Statementby Helmut Mayer and Hiroo Taguchi.
SeriesBIS economic paper -- 6
ContributionsTaguchi, Hiroo., Bank for International Settlements. Monetary and Economic Department.
ID Numbers
Open LibraryOL13823691M

  Praise for Handbook of Exchange Rates “This book is remarkable. I expect it to become the anchor reference for people working in the foreign exchange field.” —Richard K. Lyons, Dean and Professor of Finance, Haas School of Business, University of California Berkeley “It is quite easily the most wide ranging treaty of expertise on the forex market I have ever come across. Central banks’ exchange rate interventions are typically attributed to precautionary, prudential, or mercantilist motives. This column documents the prevalence of an alternative motive – that of stabilising the exchange rate – in emerging markets, where, despite heavy intervention, the Global Crisis saw important deviations of the real exchange rate from its equilibrium value.

4 WP Foreign exchange intervention: strategies and effectiveness In the aftermath of the Asian crisis, many regional central banks intervened in foreign exchange markets, in part to rebuild foreign reserves stocks. This accumulation of reserves continued almost monotonically for many economies. researchers have proposed that official intervention in foreign exchange markets might explain such profitability, but the evidence does not support this hypothesis (LeBaron (), Neely () and Sapp ()). The lack of fundamental predictability at short horizons, combined.

  The foreign exchange market is a global online network where traders buy and sell currencies. It has no physical location and operates 24 hours a day from 5 p.m. EST on Sunday until 4 p.m. EST on Friday because currencies are in high demand. It sets the exchange rates for currencies with floating rates. Note on the foreign exchange market operations of the South African Reserve Bank Daniel Mminele 1 (the oversold forward book). Such intervention, however, was not that common in other countries, although it but directed towards gradually building up the official foreign exchange reserves, managing domestic liquidity and meeting clients.


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Official intervention in the exchange markets by Helmut W. Mayer Download PDF EPUB FB2

First, the chapter, provides a number of stylized facts about the use of official FX interventions, discusses the possible motives that drive policymakers, and outlines potential costs and benefits from such actions.

Then, it presents a review of the effectiveness of official FX interventions and its underlying by: 8. About article usage data: Lorem ipsum dolor sit amet, consectetur adipiscing elit.

Aenean euismod bibendum laoreet. Proin gravida dolor sit amet lacus accumsan et viverra justo by: With topics like New open-economy macroeconomics and Official intervention in the foreign exchange market it should be clear that this book is broad in its scope and delves deeply into the area going well beyond the determinants of exchange by: Sarno and Taylor: Official Intervention in the Foreign Exchange Market More recently, a novel approach to deriving a central bank intervention re- action function has been proposed by Almekinders and Eijffinger ().

Additional Physical Format: Online version: Mayer, Helmut W. Official intervention in the exchange markets. Basle: Bank for International Settlements, Monetary and Economic Department, Title: Official Intervention in the Foreign Exchange Market: Elements of Best P ractice - WP/03/ Created Date: 8/1/ PM.

The survey emphasizes that intervention is intended to provide monetary authorities with an means of influencing their exchange rates independent from monetary policy, and tends to evaluate theoretical channels and empirical results from this perspective.

Humpage, Owen, Government Intervention in the Foreign Exchange Market (November ). Abstract. In this Paper we assess the progress made by the profession in understanding whether and how exchange rate intervention works.

To this end, we review the theory and evidence on official intervention, concentrating primarily on work published within the last decade or so. A completely floating currency exists only in textbooks.

Terms like dirty float or managed float refer to exchange rate regimes in which exchange rates are largely determined in foreign exchange markets, but certain interventions into exchange rates take place.

Interventions are divided into two categories: Indirect interventions: Monetary policy and the growth performance of countries [ ]. Foreign exchange intervention is a monetary policy tool where the central bank actively seeks to weaken or strengthen its currency for a number of reasons.

Estimating the effect of official foreign exchange market intervention is complicated by the fact that intervention at any point entails a “self-selection” choice made by the authorities and. Official intervention in the foreign exchange market.

Washington, D.C.: International Monetary Fund, © (OCoLC) Material Type: Internet resource: Document Type: Book, Internet Resource: All Authors / Contributors: Iván Canales-Kriljenko; Roberto Fernandes Guimarães-Filho; Cem Karacadag; International Monetary Fund.

Monetary and. Official Intervention in the Foreign Exchange Market: Is It Effective and, If So, How Does It Work. by Lucio Sarno and Mark P. Taylor. Published in vol issue 3, pages of Journal of Economic Literature, SeptemberAbstract: Our paper assesses progress made by the profession in und.

Government Intervention in the exchange rate Fixed Exchange Rate. A fixed exchange rate system refers to the case where the exchange rate is set and maintained at same level by the government irrespective of the market forces.

Revaluation and Devaluation. It refers to official changes in the price of a currency in a fixed exchange rate system. Official exchange rate intervention in the foreign exchange market occurs when the authorities buy or sell foreign exchange, normally against their own currency and in order to affect the exchange rate.

Whether or not official exchange rate intervention is effective in influencing exchange rates, and the means by which it. This article offers a survey of the literature on foreign exchange intervention, including sections on the theoretical channels through which intervention might affect exchange rates and a summary of the empirical findings.

Government Intervention in the Foreign Exchange Market. Owen, "Government Intervention in the. Official intervention in the foreign exchange market means that the central bank or other agent of the government buys or sells foreign currency in an attempt to influence the exchange rate value. Purchases of foreign exchange usually are intended to push down the home currency value of the exchange rate, and sales usually are intended to push.

Working Paper November Government Intervention in the Foreign Exchange Market By Owen F. Humpage This article offers a survey of the literature on foreign exchange intervention, including sections on the theoretical channels through which intervention might affect exchange rates and a summary of the empirical findings.

Foreign exchange market intervention and expectations: an empirical study of the yen/dollar exchange rate by Gabriele Galati∗a, William Melickb and Marian Micua a Monetary and Economic Dep artm ent, Bank for Int rnational Set tlemen s, CH B l, Switz rland b Department of E conomics, Kenyon College, As ension Hall, Gambier, OhioUnited States.

A series of surveys by the BIS (Bank for International Settlements),BIS, and the World Bank (de la Torre et al., ) exploring the motives and effectiveness of intervention from the perspective of the central banks of emerging economies, support the view that central banks intervene actively, especially in the spot market, to prevent excessive swings of the exchange rate (the.

Often, statements that reflect the official U.S. stance on its exchange rate policy accompany the Treasury's confirmation of intervention activity. The Federal Reserve routinely "sterilizes" intervention in the FX market, which prevents the intervention from changing the amount of bank reserves from levels consistent with established monetary.

Government intervention in the foreign exchange market 10 January 28 November by Tejvan Pettinger Under certain circumstances, the government might want to intervene in the foreign exchange markets to influence the level of the exchange rate.Currency intervention, also known as foreign exchange market intervention or currency manipulation, is a monetary policy operation.

It occurs when a government or central bank buys or sells foreign currency in exchange for its own domestic currency, generally with the intention of influencing the exchange rate and trade policy.