When Is Foreign Exchange Intervention Effective? Evidence from 33 Countries

Marcel Fratzscher, Oliver Gloede, Lukas Menkhoff, Lucio Sarno and Tobias Stöhr
Authors registered in the RePEc Author Service: Tobias Heidland

American Economic Journal: Macroeconomics, 2019, vol. 11, issue 1, 132-56

Abstract: This paper examines foreign exchange intervention based on novel daily data covering 33 countries from 1995 to 2011. We find that intervention is widely used and an effective policy tool, with a success rate in excess of 80 percent under some criteria. The policy works well in terms of smoothing the path of exchange rates, and in stabilizing the exchange rate in countries with narrow band regimes. Moving the level of the exchange rate in flexible regimes requires that some conditions are met, including the use of large volumes and that intervention is made public and supported via communication.

JEL-codes: E52 E58 F31 F33 O19 O24 (search for similar items in EconPapers)
Date: 2019
Note: DOI: 10.1257/mac.20150317
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (107)

Downloads: (external link)
https://www.aeaweb.org/doi/10.1257/mac.20150317 (application/pdf)
https://www.aeaweb.org/articles/attachments?retrie ... 57HAY0xxmhgVMgDN1C3p (application/zip)
https://www.aeaweb.org/articles/attachments?retrie ... XMvPS5SoZIPaqJa-7X0L (application/pdf)
https://www.aeaweb.org/articles/attachments?retrie ... 4D_9BUeSqH5hvGAxYUo9 (application/zip)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
Journal Article: When Is Foreign Exchange Intervention Effective? Evidence from 33 Countries (2019)
Working Paper: When is foreign exchange intervention effective? Evidence from 33 countries (2017)
Working Paper: When Is Foreign Exchange Intervention Effective? Evidence from 33 Countries (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aea:aejmac:v:11:y:2019:i:1:p:132-56

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Journal: Macroeconomics is currently edited by Simon Gilchrist

More articles in American Economic Journal: Macroeconomics from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().