Interrelations of two economies with flexible exchange rates

Authors

  • José Uriarte Center for Monetary and Banking Studies (BCRA), Argentina

Keywords:

Economic Policy, Exchange Rate, Financial Markets, International Economy

Abstract

This note aims to analyze the interactions between two countries whose currencies are linked through flexible exchange rates. This analysis is relevant because the experience with flexible exchange rates shows that interest rates have evolved in the same direction in countries whose monetary and capital markets are integrated and that exchange rates have had wide fluctuations. The work emphasizes the integration of financial markets; Therefore, the economic policy measures taken in a country or changes in expectations not only have internal but also external effects in the very short run.

JEL classification: F41 ; F42

Downloads

Download data is not yet available.

Downloads

Published

1979-09-01

How to Cite

Uriarte, J. (1979) “Interrelations of two economies with flexible exchange rates”, Ensayos Económicos, (11), pp. 5–28. available at: https://bcra.ojs.theke.io/ensayos_economicos_bcra/article/view/620 (accessed: 3 May 2025).

Issue

No. 11 (1979): Ensayos Económicos

Section

Articles