 How do COVID-19 containment policies affect currency status?Juanjuan Zhuo and Masao Kumamoto Global Business and Economics Review, 2026, vol. 34, issue 2, 178-218 Abstract: We employed copula-dynamic conditional correlation and threshold approaches to investigate the status of the JPY, CHF, EUR and GBP during the COVID-19 period vis-à-vis various kinds of assets - specifically, stocks, government bonds, currencies and commodities. Further, we investigated how containment policies affected currency status. We classified currency status into diversifier, hedge and safe-haven currencies. Our main findings were as follows: first, while currency status' behaviours differ in different asset markets, the JPY acted as a hedge in stock, emerging countries' currency and commodity markets in tranquil periods, and acted as a safe haven in times of financial stress. Second, the currency of a country with strict containment policies tended to appreciate when market uncertainty increased, suggesting that the roles of the EUR, CHF and GBP as diversifiers and that of the JPY as a hedge strengthened. Third, vaccination might have contributed in reducing negative investor sentiment and their COVID-19-related concerns. Keywords: COVID-19; containment policy; vaccination; diversifier currency; hedge currency; safe-haven currency; global risk; equity market volatility; copula-DCC; threshold. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ids:gbusec:v:34:y:2026:i:2:p:178-218 Access Statistics for this article More articles in Global Business and Economics Review from Inderscience Enterprises Ltd |
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