International trade and the risk premium in the currency forward market

Eckwert B, Broll U (1998)
Journal of economic integration 13(4): 662-672.

Journal Article | Published | English

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In this paper we present an intertemporal model of the spot and forward markets for foreign exchange. We analyze the implications of central bank interventions on the spot market for the risk premium in the currency forward market and discuss the consequences for the allocation of exchange rate risk and for the volume of international trade. As a main result we find that exchange rate volatility does not generate systematic risk and hence does not adversely affect international trade as long as the monetary authorities do not exogenously intervene in the foreign exchange spot market.
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Eckwert B, Broll U. International trade and the risk premium in the currency forward market. Journal of economic integration. 1998;13(4):662-672.
Eckwert, B., & Broll, U. (1998). International trade and the risk premium in the currency forward market. Journal of economic integration, 13(4), 662-672.
Eckwert, B., and Broll, U. (1998). International trade and the risk premium in the currency forward market. Journal of economic integration 13, 662-672.
Eckwert, B., & Broll, U., 1998. International trade and the risk premium in the currency forward market. Journal of economic integration, 13(4), p 662-672.
B. Eckwert and U. Broll, “International trade and the risk premium in the currency forward market”, Journal of economic integration, vol. 13, 1998, pp. 662-672.
Eckwert, B., Broll, U.: International trade and the risk premium in the currency forward market. Journal of economic integration. 13, 662-672 (1998).
Eckwert, Bernhard, and Broll, Udo. “International trade and the risk premium in the currency forward market”. Journal of economic integration 13.4 (1998): 662-672.
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