Financial account liberalizations since the second half of the 1980s paved the way for the
burgeoning literature that investigates foreign exchange market efficiency in emerging …

This paper surveys the literature on the linkages between asset prices and macroeconomic
outcomes. It focuses on three major questions. First, what are the basic theoretical linkages …

A major puzzle in international finance is that high interest rate currencies tend to appreciate
(forward discount puzzle). Motivated by the fact that only a small fraction of foreign currency …

This paper provides a selective overview of puzzles in exchange rate economics. We begin
with the forward bias puzzle: high interest rate currencies appreciate when one might guess …

Financial integration has strong implications for financial stability. On the one hand, financial
integration among economies helps to improve their capacity to absorb shocks and foster …

This chapter sets out to examine the concept of equilibrium exchange rates. Empirical
estimates of equilibrium exchange rates are frequently cited in policy-related discussions of …

Many studies have replicated the finding that the forward rate is a biased predictor of the
future change in the spot exchange rate. Usually the forward discount actually points in the …

This paper provides a comprehensive evaluation of the short-horizon predictive ability of
economic fundamentals and forward premiums on monthly exchange-rate returns in a …

Thought-provoking and clearly explained, the new edition provides students of international
economics and international business with a rigorous explanation of global economic theory …

This paper examines several new empirical findings in the study of uncovered interest parity.
It reviews recent developments in the study of long-horizon interest parity regressions, the …