Forward Intervention, Risk Premium and the Fluctuations of International Financial Market

Hui-Kuan Tseng ()
Additional contact information
Hui-Kuan Tseng: The University of North Carolina at Charlotte, Department of Economics, Postal: 9201 University City Blvd Charlotte NC 28223-0001,USA ,, http://www.uncc.edu/

Economia Internazionale / International Economics, 1993, vol. 46, issue 2-3, 276-287

Abstract: The paper examines the effects of forward market intervention on fluctuations of the forward rate, the spot rate and the domestic interest rate in a partial-equilibrium, stochastic model. In contrast to recent work, this paper highlights the role of risk premium iii interpreting why such intervention may or may not serve as an effective instrument of monetary policy from the short-term and long-term perspectives. It shows that forward intervention is desirable only when the destabilizing disturbance originates in the forward exchange market. A general analysis is given without relying on numerical simulation.

Date: 1993
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
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:ris:ecoint:0443

Access Statistics for this article

Economia Internazionale / International Economics is currently edited by Giovanni Battista Pittaluga

More articles in Economia Internazionale / International Economics from Camera di Commercio Industria Artigianato Agricoltura di Genova Via Garibaldi 4, 16124 Genova, Italy. Contact information at EDIRC.
Bibliographic data for series maintained by Angela Procopio ().