Search Results
Conference Paper
Theoretical analysis regarding a zero lower bound on nominal interest rates
This paper explores several issues concerning a possible zero lower bound (ZLB) including its theoretical rationale; the magnitude of effects of low sustained inflation on real interest rates; the validity of analyzing monetary policy in models with no monetary variables; and the dynamic stabilizing properties of Taylor rules in a ZLB context. The most important argument, however, is that if the short nominal rate is immobilized at zero, there nevertheless exists a route for monetary stabilization policy to be effective--via the foreign exchange market. Its quantitative importance is examined ...
Working Paper
On the evolution of U.S. foreign-exchange-market intervention: thesis, theory, and institutions
Attitudes about foreign-exchange-market intervention in the United States evolved in tandem with views about monetary policy as policy makers grappled with the perennial problem of having more economic objectives than independent instruments with which to achieve them. This paper?the introductory chapter to our history of U.S. foreign exchange market intervention?explains this thesis and summarizes our conclusion: The Federal Reserve abandoned frequent foreign-exchange-market intervention because, rather than providing a solution to the instruments-versus-objectives problem, it interfered ...
Monograph
All about the foreign exchange market in the United States
The focus of the book is on the U.S. segment of the global foreign exchange market. Chapters 1-3 describe the structure of the market and how it has changed. Chapters 4-6 comment on the main participant groups and the instruments that are traded. Chapters 7-8 look at foreign exchange trading from a micro, rather than macro, point of view - how an individual bank or other dealing firm sees things. Chapters 9-11 comment on some of the broader issues facing the international monetary system and how governments, central banks, and market participants operate within that system. This is followed ...
Working Paper
Real-time price discovery in global stock, bond and foreign exchange markets
Using a unique high-frequency futures dataset, we characterize the response of U.S., German and British stock, bond and foreign exchange markets to real-time U.S. macroeconomic news. We find that news produces conditional mean jumps; hence high-frequency stock, bond and exchange rate dynamics are linked to fundamentals. Equity markets, moreover, react differently to news depending on the stage of the business cycle, which explains the low correlation between stock and bond returns when averaged over the cycle. Hence our results qualify earlier work suggesting that bond markets react most ...
Working Paper
U.S. monetary-policy evolution and U.S. intervention
The United States all but abandoned its foreign-exchange-market intervention operations in late 1995, when they proved corrosive to the credibility of the Federal Reserve?s commitment to price stability. We view this decision as the culmination of the evolution of U.S. monetary policy over the past century from a gold standard to a fiat money regime. The abandonment of intervention was necessary to secure monetary policy credibility.
Journal Article
Foreign exchange markets: the dollar in 1980
Speech
Dollar asset markets: prospects after the crisis
Remarks at the ACI 2010 World Congress, Sydney, Australia.
Journal Article
Exchange rate policy and the dual role of exchange rate movements in international adjustment
An abstract for this article is not available
Journal Article
Summary measures of the dollar's foreign exchange value
Journal Article
How economic news moves markets
Exploring how the release of new economic data affects asset prices in the stock, bond, and foreign exchange markets, the authors find that only a few announcements - the nonfarm payroll numbers, the GDP advance release, and a private sector manufacturing report - generate price responses that are economically significant and measurably persistent. Bond yields show the strongest response and stock prices the weakest. The authors' analysis of the direction of these effects suggests that news of stronger-than-expected growth and inflation generally prompts a rise in bond yields and the exchange ...