Exchange Rate Forecasting Techniques, Survey Data, and Implications for the Foreign Exchange Market
32 Pages Posted: 15 Feb 2006
There are 2 versions of this paper
Exchange Rate Forecasting Techniques, Survey Data, and Implications for the Foreign Exchange Market
Exchange Rate Forecasting Techniques, Survey Data, and Implications for the Foreign Exchange Market
Date Written: May 1990
Abstract
This paper examines the dynamics of the foreign exchange market. The first half addresses a number of key questions regarding the forecasts of future exchange rates made by market participants, by means of updated estimates using survey data. Here we follow most of the theoretical and empirical literature in acting as if all market participants share the same expectation. The second half then addresses the possibility of heterogeneous expectations, particularly the distinction between "chartists" and "fundamentalists," and the implications for trading in the foreign exchange market and for the formation of speculative bubbles.
JEL Classification: 430
Suggested Citation: Suggested Citation
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