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On the Effectiveness of Central Bank Intervention in the Foreign Exchange Market: The Case of Slovakia, 1999–2007
, J. Zeman, Ľ. Ódor, Jr. Riiska
Published in Palgrave Macmillan Ltd.
Volume: 60
Issue: 3
Pages: 442 - 474
Based on intraday high-frequency data, this paper investigates the effect of sterilized interventions on the Slovak koruna/euro exchange rate for different time windows during a period that coincides with Slovakia’s preparation for EU accession and euro adoption. Results confirm a significant relationship between intervention and exchange rate change. The maximum effect of intervention is reflected in the exchange rate change within a couple of hours, and the effect over longer time windows weakens only gradually. The initial impact of sale interventions is stronger than that of purchase interventions. © 2017, Association for Comparative Economic Studies.
About the journal
JournalComparative Economic Studies
PublisherPalgrave Macmillan Ltd.