Buletin Ekonomi Moneter dan Perbankan
Vol 17 No 2 (2014)

Foreign Exchange Expectations in Indonesia: Regime Switching Chartists & Fundamentalists Approach

dedi budiman (Unknown)

Article Info

Publish Date
20 Sep 2018

Abstract

In this research, the effect of central bank intervention within a heterogeneous expectations exchange rate model, is investigated. The empirical evidence is conducted by applying a Markov switching approach to daily USD/IDR exchange rate, intervention data of Bank Indonesia from 2006 to 2012. The results are supporting both chartists and fundamentalist regimes. It is shown that the two regimes are persistent. Meanwhile, Bank Indonesia’s foreign-exchange intervention has been able to drive the USD/IDR to its fundamentalist rule. However, Bank Indonesia efforts to exert a stabilizing effect of foreign exchange interventions, the result are inconclusive.

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Journal Info
Buletin Ekonomi Moneter dan Perbankan
Website

Abbrev

BEMP

Publisher

Bank Indonesia

Subject

Description

The Buletin Ekonomi Moneter dan Perbankan/Bulletin of Monetary Economics and Banking (BMEB) is an international peer-reviewed journal. This is a quarterly journal, published in January, April, July and August. The BMEB focuses on a broad range of topics covering monetary economics, banking, ...