Our website will undergo scheduled maintenance on March 6th, 2024. During this time, connection to our website and some of its features may be unavailable. Thank you for your patience, and we apologize for any inconvenience.

Journal Article

China's Exchange Rate Policies and U.S. Financial Markets


Abstract: Exchange rate stabilization or currency ?pegs? are among the most prevalent interventions in international financial markets. Removing a peg to a safer currency can make the home currency more risky and less attractive to investors. When a country with market influence removes its peg from a safer country, the risk associated with holding either currency can be affected. Analyzing the effects of a scenario that changes a peg of the renminbi from the U.S. dollar to a basket of currencies suggests that China?s interest rates increase while U.S. interest rates decrease.

Access Documents

File(s): File format is application/pdf http://www.frbsf.org/economic-research/files/el2017-28.pdf
Description: Full text

Authors

Bibliographic Information

Provider: Federal Reserve Bank of San Francisco

Part of Series: FRBSF Economic Letter

Publication Date: 2017

Order Number: 28