Mylonidis, Nikolaos and Stamopoulou, Ioanna (2011): The role of monetary policy in managing the euro - dollar exchange rate.
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The US Federal Reserve’s new relaxed monetary policy (the so-called quantitative easing) has triggered controversy among economists and policy makers about its effectiveness. This paper investigates the role of monetary policy in managing the euro – dollar exchange rate via alternative cointegration tests and impulse response functions. It is found that monetary fundamentals have neither long- nor short-run impact on the exchange rate. This implies that the Fed’s quantitative easing schemes are unlikely to have any significant impact on the euro – dollar rate.
|Item Type:||MPRA Paper|
|Original Title:||The role of monetary policy in managing the euro - dollar exchange rate|
|Keywords:||Exchange rates; Monetary model; Cointegration; Impulse response functions|
|Subjects:||E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy
F - International Economics > F3 - International Finance > F31 - Foreign Exchange
|Depositing User:||Nikolaos Mylonidis|
|Date Deposited:||08. Mar 2011 01:04|
|Last Modified:||19. Feb 2013 06:44|
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