Dirty float or clean intervention? The Bank of England on the foreign exchange market, 1952-72

Alain Naef

No 32, Working Papers from Department of Economic and Social History at the University of Cambridge

Abstract: Using over 40,000 new observations on intervention and exchange rates, this paper is the first study of Bank of England foreign exchange intervention between 1952 and 1972. The main finding is that the Bank was unsuccessful in managing a credible exchange rate. By estimating a reaction function, I find that the Bank of England during most of the period refused to intervene on the forward market which was growing in importance. Analysing alternative exchange rates, I show how the Bank failed to maintain credibility in offshore markets. The Bank was eventually forced to manipulate the publication of its reserve figures to avoid a run on sterling.

Keywords: Bretton Woods; Foreign exchange intervention; Bank of England; exchange rate (search for similar items in EconPapers)
JEL-codes: E42 E58 F31 N24 (search for similar items in EconPapers)
Pages: 48 pages
New Economics Papers: this item is included in nep-his, nep-mac and nep-mon
References: Add references at CitEc
Citations: View citations in EconPapers (3)

Published in Cambridge Working Paper in Economic & Social History, No. 32

Downloads: (external link)
http://www.econsoc.hist.cam.ac.uk/docs/CWPESHnumber32April2018.pdf None. (application/pdf)
None.

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:cmh:wpaper:32

Access Statistics for this paper

More papers in Working Papers from Department of Economic and Social History at the University of Cambridge Contact information at EDIRC.
Bibliographic data for series maintained by Guillaume Proffit () and Alexis Litvine ().