The Credibility of Nordic Exchange Rate Bands: 1987-1991
Summary:
The credibility of the exchange rate bands in the Nordic countries during 1987-91 is examined with two tests. The results suggest that the credibility of Finland’s exchange rate band within a twelve-month horizon could not be rejected except in the fall of 1991; however, the band lacked credibility within a five-year horizon throughout the period. Denmark’s and Norway’s bands lacked both short- and long-term credibility at the beginning of the period, but credibility could not be rejected from 1989 for Norway and as of 1990 for Denmark. The credibility of Sweden’s band within a one-year horizon could not be rejected up to fall 1989, but thereafter its credibility deteriorated sharply.
Series:
Working Paper No. 1992/003
Subject:
Central banks Crawling peg Exchange rates Financial services Foreign exchange Forward exchange rates Interest rate parity International reserves
English
Publication Date:
January 1, 1992
ISBN/ISSN:
9781451841817/1018-5941
Stock No:
WPIEA0031992
Pages:
24
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