Exchange Rates
Winter 2004
The
new sterling ERI 
(181k)
By Birone Lynch and Simon Whitaker
This article explains proposals for a new sterling trade-weighted
effective exchange rate index. The proposed new index would
reflect more recent trade patterns, incorporate services trade
and a broader set of countries, including those in Asia.
August 2000
The
exchange rate and the MPC: what can we do?
(85k)
Speech by Sushil Wadhwani to the Senior Business Forum at the
Centre for Economic Performance
Argues that looking only at a two year ahead inflation forecast
when setting interest rates is likely to be sub-optimal, and
that allowing asset price misalignments to have an additional
impact on interest rates could enable a reduction in the volatility
of inflation.
November 1997
Decomposing
exchange rate movements according to the uncovered interest
rate parity condition
(96k)
By Andrew Brigden, Ben Martin and Chris Salmon
Discusses relationship between exchange rate and monetary policy.
May 1997
Monetary
policy and the exchange rate
(13k)
Speech by Mervyn King at Euromoney International Bond Congress
Considers the implication of the recent rise in sterling for
inflation and interest rates. Argues that any coherent analysis
of the implications of a change in the exchange rate must consider
why the exchange rate has moved. Different explanations have
different implications for inflation and monetary policy. It
is for this reason, argues Mervyn King, that there is no mechanical
link between the exchange rate and domestic interest rates.
November 1993
Monetary
policy implications of increased capital flows
(1.6mb)
By Andrew Crockett, Executive Director of the Bank of England.
Paper presented to the August 1993 Jackson Hole symposium, 'Changing
capital markets: implications for monetary policy', organised
by the Federal Reserve Bank of Kansas City
Discusses impact of increased capital flows on monetary policy,
the choice of exchange rate regime in conditions of capital
mobility, the implementation of monetary policy when capital
is mobile and international policy co-ordination.
