Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/122307 
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Title: 

When is foreign exchange intervention effective? Evidence from 33 Countries

The document was removed on behalf of the author(s)/ the editor(s).

Year of Publication: 
2015
Series/Report no.: 
DIW Discussion Papers No. 1518
Publisher: 
Deutsches Institut für Wirtschaftsforschung (DIW), Berlin
Abstract: 
This study examines foreign exchange intervention based on novel daily data covering 33 countries from 1995 to 2011. We find that intervention is widely used and a highly effective policy tool, with a success rate in excess of 80 percent under some criteria. The policy works very well in terms of smoothing the path of exchange rates, and in stabilizing the exchange rate in countries with narrow band regimes. Moving the level of the exchange rate in flexible regimes requires that some conditions are met, including the use of large volumes and that intervention is made public and supported via communication.
Subjects: 
foreign exchange intervention
exchange rate regimes
effectiveness measures
communication
capital controls
JEL: 
F31
F33
E58
Document Type: 
Working Paper

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The document was removed on behalf of the author(s)/ the editor(s) on: April 24, 2017


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