Working Paper

Central bank authorities’ beliefs about foreign exchange intervention

Abstract: This paper presents the results of a survey of monetary authorities with respect to foreign exchange intervention. The survey offers evidence on new issues that would otherwise be difficult to investigate, such as response times, non-foreign exchange factors in intervention and profitability. The survey also reveals new evidence on previously studied issues, such as channels of effectiveness. Respondents disagreed with predominant views on intervention and volatility and common arguments against intervention. Exchange rate regimes explain central bank beliefs about important aspects of intervention, including factors that lead to detection of secret interventions and the potential profitability of intervention. ; Earlier title: Authorities' beliefs about foreign exchange intervention: getting back under the hood

Keywords: Foreign exchange; Banks and banking, Central;

Status: Published in Journal of International Money and Finance, February 2008, 27(1), pp. 1-25

Bibliographic Information

Provider: Federal Reserve Bank of St. Louis

Part of Series: Working Papers

Publication Date: 2007

Number: 2006-045