Czech paper deconstructs exchange rate variability in advanced economies

Economic fundamentals cause just a third of exchange rate variability

Volatility arrows2

Economic fundamentals only comprise one-third of the medium-term exchange rate variability experienced by advanced economies, according to a Czech National Bank working paper published last week.

In Sources of Asymmetric Shocks: The Exchange Rate or Other Culprits? Michal Skořepa and Luboš Komárek say a floating exchange rate can work as an "absorber" of asymmetric shocks – including changes in foreign monetary policy, productivity and terms of trade – but can also generate shocks that reflect

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact info@centralbanking.com to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Central Banking? View our subscription options

Register for Central Banking

All fields are mandatory unless otherwise highlighted

This address will be used to create your account

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account

.