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Why are exchange rates so difficult to predict?


  • Jian Wang


A quarter-century quest hasn't found the elusive links between economic fundamentals and currency values. ; The U.S. dollar has been losing value against several major currencies this decade. Since 2001-02, the U.S. currency has fallen about 50 percent against the euro, 40 percent against the Canadian dollar and 30 percent against the British pound .

Suggested Citation

  • Jian Wang, 2008. "Why are exchange rates so difficult to predict?," Economic Letter, Federal Reserve Bank of Dallas, vol. 3(jun).
  • Handle: RePEc:fip:feddel:y:2008:i:jun:n:v.3no.6

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    Cited by:

    1. Christian Mueller-Kademann, 2016. "The puzzle that just isn't," Papers 1604.08895,
    2. repec:fgv:epgrbe:v:66:n:3:a:3 is not listed on IDEAS
    3. repec:eee:ecosys:v:41:y:2017:i:3:p:389-407 is not listed on IDEAS
    4. Matos, Paulo & Beviláqua, Giovanni & Filho, Jaime, 2012. "Previsão do câmbio real-dólar sob um arcabouço de apreçamento de ativos," Revista Brasileira de Economia - RBE, FGV/EPGE - Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil), vol. 66(3), October.
    5. Radim Gottwald, 2015. "The Forecasting of Spot Exchange Rates Based on the Forward Exchange Rates," MENDELU Working Papers in Business and Economics 2015-52, Mendel University in Brno, Faculty of Business and Economics.
    6. Amador-Torres, J. Sebastián, 2017. "Finance-neutral potential output: An evaluation in an emerging market monetary policy context," Economic Systems, Elsevier, vol. 41(3), pages 389-407.


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