CFCM 17/05: Are Fixed Exchange Rates Still a Mirage?

Abstract

In the twenty-first century, pegged exchange rates have become increasingly fixed: parity changes have become significantly rarer than in the 1980s and 1990s.  Analysis of what triggers parity changes suggests that the high frequency of parity changes in the late twentieth century reflected the inflationary conditions of the time rather than a permanent shift associated with financial globalization.


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Authors

Michael Bleaney and Mo Tian

 

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