Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/243015
Authors: 
Çakmaklı, Cem
Demiralp, Selva
Güneş, Gökhan Şahin
Year of Publication: 
2021
Series/Report no.: 
Working Paper No. 2112
Publisher: 
Koç University-TÜSIAD Economic Research Forum (ERF), Istanbul
Abstract: 
With the global rise in authoritarianism, there has been an increase in political commentaries by the populist leaders that have criticized their central banks in favor of lower interest rates. We analyze the effects of these political pressures on exchange rates. We provide strong empirical evidence where political commentaries affect both the level and the volatility of exchange rate returns. The intensity of political pressures as well as institutional strength play a key role in determining the size of the impact.
Subjects: 
Political pressure
exchange rate
time inconsistency
populism
JEL: 
E5
G1
F31
Document Type: 
Working Paper

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