Template-Type: ReDIF-Paper 1.0

Author-Name: Christoph S. Weber
Author-X-Name-First: Christoph
Author-X-Name-Last: Weber

Title: The Effect of Central Bank Transparency on Exchange Rate Volatility

	
Abstract: The increase in central bank transparency was one of the main developments in central banking in the last two decades. This leads to the question of which effect central bank transparency has on the volatility of exchange rates. According to theoretical considerations, more information could either lead to more precise forecasts or to more noise trading. This raises the need for an empirical estimation of the relationship. The study shows that the effect of central bank transparency on exchange rate volatility depends on the development of countries. While there is no effect of central bank transparency in the composite sample and for developing countries, transparency increases exchange rate fluctuations in developed countries.
Length: 67 pages
Creation-Date:  2017-09
File-URL: http://www.bgpe.de/texte/DP/174_Weber.pdf
File-Format: Application/pdf
File-Function: First version, 2017
Number: 174
Classification-JEL: E24, E58, F31
Keywords: Central Bank Transparency, Exchange Rate Volatility, Monetary Policy
Handle: RePEc:bav:wpaper:174_Weber