On the Potential Hedging Instruments Against Central Bank Digital Currency Uncertainty and Attention Indices

Javed Bin Kamal, Mark Wohar and Khaled Bin Kamal ()
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Khaled Bin Kamal: East West University, Dhaka, Bangladesh

Asian Economics Letters, 2024, vol. 5, issue 2, 1-7

Abstract: We study dynamic conditional correlations of Central Bank Digital Currency (CBDC) uncertainty and attention indices with US dollar futures, 1-year US government bond, and gold futures. We find that USD futures hedges CBDC uncertainty, while the US bond hedges the CBDC uncertainty index subsequent to 2019. Interestingly, gold does not hedge CBDC uncertainty. The CBDC attention index exerts a negative effect on the other assets. These results are important for portfolio management.

Keywords: Central bank digital currency uncertainty and attention indices; US dollar futures; Gold; 1-year US government bond (search for similar items in EconPapers)
JEL-codes: E58 G12 (search for similar items in EconPapers)
Date: 2024
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