Large changes in major exchange rates: a chronicle of the 1990s
In the continuing effort to understand exchange rate changes, this article chronicles and analyses, for the first time, the proximate reasons for large daily movements in four leading US dollar exchange rates in the 1990s. A sample of 111 events highlights the importance of expectations and the role of subtle political influences on currency markets. While 19% of all events studied had mainly economic reasons, over 60% of all events could be partly or wholly attributed to political factors. Events related to monetary policy changes were the most significant economic factor, while intervention activity and war/coup attempts were the most significant political factors. This research indicates that large changes in the Japanese yen were caused mostly by the political dynamics of the bilateral trade balance, while big moves in the German mark and British pound stemmed mainly from European politico-economic events. The enigmatic Canadian dollar was driven by domestic politics related to the Quebec secession issue.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 12 (2002)
Issue (Month): 11 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/RAFE20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RAFE20|
When requesting a correction, please mention this item's handle: RePEc:taf:apfiec:v:12:y:2002:i:11:p:805-811. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.