Modeling an Alternative Expression of Covered Interest Parity – in Inflation Targeting Economies of Emerging Asia
DOI:
https://doi.org/10.6000/1929-7092.2014.03.28Keywords:
Capital Mobility Covered Interest Parity Model, Arbitragers, Speculators, Onshore and Offshore Foreign Exchange Forward Market, Arbitrage Profit and Loss, Emerging Asia.Abstract
We establish an alternative form of expressing the covered interest parity model that incorporates the onshore and offshore foreign exchange forward market of inflation targeting economies of Emerging Asia, which provides the ability to identify if there is the occurrence of covered interest parity in foreign exchange forward markets.References
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http://dx.doi.org/10.1162/0034653054638300
http://dx.doi.org/10.1016/j.jimonfin.2012.02.016
Fleming, J. Marcus, ‘Domestic financial policies under fixed and floating exchange rates’, IMF Staff Papers, 9, 1962, pp 369-379
http://dx.doi.org/10.2307/3866091
Gray, D. and Malone, S., (2008), ‘Macrofinancial Risk Analysis’, John Wiley & Sons.
http://dx.doi.org/10.1002/9781118467428
Herman Kamil and Alejandro Reveiz, ‘Carry Trade and Derivatives market in Columbia, Mechanisms and Policy Implications’, Regional Workshop on Derivatives Market, 24th April, 2008.
Imad A. Moosa, ‘International Finance-An Analytical Approach’, 1999, pp 283-321, McGraw-Hill.
Madura, J., (2008), Financial Institutions and Markets, Chapter 16, Foreign Exchange Derivatives Market, pp 426-471, Cengage Learning
Mundell, Robert A., ‘Capital mobility and stabilization policy under fixed and flexible exchange rates’, Canadian Journal of Economic and Political Science 29 (4), 1963, pp 475-485.
http://dx.doi.org/10.2307/139336
Obstfeld, M., Shambaugh, J.C. and Taylor, A.M., (2005), ‘The Trilemma in History: Tradeoffs among Exchange Rates, Monetary Policies, and Capital Mobility’, Review of Economics and Statistics 87, pp 423-438.
http://dx.doi.org/10.1162/0034653054638300
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Published
2014-10-24
How to Cite
Ramanathan, S., & Kwek, K.-T. (2014). Modeling an Alternative Expression of Covered Interest Parity – in Inflation Targeting Economies of Emerging Asia. Journal of Reviews on Global Economics, 3, 373–376. https://doi.org/10.6000/1929-7092.2014.03.28
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