The Share of Systematic Variations in the Canadian Dollar—Part III

Guillaume Nolin, James Kyeong and Jean-Sebastien Fontaine

No 2018-13, Staff Analytical Notes from Bank of Canada

Abstract: We draw a parallel between the dramatic increases of systematic variations in exchange rates and international bank lending. We find that when a country’s currency has a larger share of systematic variations, lending flows by international banks to that country become more sensitive to global lending - they also become more systematic. This parallel is particularly prevalent for large commodity exporters, including Canada. Global financial intermediation may open a new channel between the real economy and exchange rates.

Keywords: Exchange; rates (search for similar items in EconPapers)
JEL-codes: F F3 F31 (search for similar items in EconPapers)
Pages: 6 pages
Date: 2018
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https://www.bankofcanada.ca/2018/05/staff-analytical-note-2018-13/ Full text (text/html)

Related works:
Working Paper: The Share of Systematic Variations in the Canadian Dollar—Part I (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:bca:bocsan:18-13

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