BIS’s Shin links dollar strength to global malaise

Hyun Song Shin

The Bank for International Settlements' (BIS) Hyun Song Shin extended his ideas on the breakdown of covered interest parity today (November 15), sketching a framework that could solve a range of current economic puzzles.

Shin's recent research has focused on deviations from covered interest parity (CIP), which he described as possibly "the most secure rule in economics" in remarks to the London School of Economics this morning.

CIP holds that arbitrage will eliminate the spread between domestic