The choice of exchange rate regime for Czech koruna in the context of ERM II participation and the related risks

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F26138077%3A_____%2F18%3A%230000901" target="_blank" >RIV/26138077:_____/18:#0000901 - isvavai.cz</a>

Výsledek na webu

<a href="http://www.jois.eu/?403,en_the-choice-of-exchange-rate-regime-for-czech-koruna-in-the-context-of-erm-ii-participation-and-the-related-risks" target="_blank" >http://www.jois.eu/?403,en_the-choice-of-exchange-rate-regime-for-czech-koruna-in-the-context-of-erm-ii-participation-and-the-related-risks</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.14254/2071-8330.2018/11-1/9" target="_blank" >10.14254/2071-8330.2018/11-1/9</a>

Jazyk výsledku

angličtina

Název v původním jazyce

The choice of exchange rate regime for Czech koruna in the context of ERM II participation and the related risks

Popis výsledku v původním jazyce

Participation in the exchange rate mechanism ERM II (one of the Maastricht criteria – exchange rate stability) is compatible with certain exchange rate regimes only. The aim of this paper is to find arguments for choosing one of these regimes. The starting point is the current strategy of the euro introduction in the Czech Republic, and the expressed concerns about the risks associated with fixing of the exchange rate. The used method is analysis of data on the currency participation in ERM II and searching for analogies of Czech koruna. The analysis consists of the identification of exchange rate regimes used before and after ERM II so that to determine the duration of ERM II involvement. Fixing of the exchange rate in the regime peg with a band of oscillation of 15% in both directions is the working hypothesis. Criteria of the so-called normal fluctuations margins and the so-called severe tension are also discussed. Development trend of the CZK/EUR exchange rate is examined. The outcome of the research is finding the risks associated with this exchange rate regime. It is the risk of a narrow fluctuation band (2.25%) in depreciation direction and the risk in the form of foreign exchange intervention or interest rate differential at excessive appreciation of the exchange rate.

Název v anglickém jazyce

The choice of exchange rate regime for Czech koruna in the context of ERM II participation and the related risks

Popis výsledku anglicky

Participation in the exchange rate mechanism ERM II (one of the Maastricht criteria – exchange rate stability) is compatible with certain exchange rate regimes only. The aim of this paper is to find arguments for choosing one of these regimes. The starting point is the current strategy of the euro introduction in the Czech Republic, and the expressed concerns about the risks associated with fixing of the exchange rate. The used method is analysis of data on the currency participation in ERM II and searching for analogies of Czech koruna. The analysis consists of the identification of exchange rate regimes used before and after ERM II so that to determine the duration of ERM II involvement. Fixing of the exchange rate in the regime peg with a band of oscillation of 15% in both directions is the working hypothesis. Criteria of the so-called normal fluctuations margins and the so-called severe tension are also discussed. Development trend of the CZK/EUR exchange rate is examined. The outcome of the research is finding the risks associated with this exchange rate regime. It is the risk of a narrow fluctuation band (2.25%) in depreciation direction and the risk in the form of foreign exchange intervention or interest rate differential at excessive appreciation of the exchange rate.

Druh

J_SC - Článek v periodiku v databázi SCOPUS

CEP obor

—

OECD FORD obor

50200 - Economics and Business

Projekt

<a href="/cs/project/GA16-21506S" target="_blank" >GA16-21506S: Nové zdroje systémového rizika na finančních trzích</a><br>

Návaznosti

P - Projekt vyzkumu a vyvoje financovany z verejnych zdroju (s odkazem do CEP)

Rok uplatnění

2018

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název periodika

Journal of International Studies

ISSN

2306-3483

e-ISSN

—

Svazek periodika

Neuveden

Číslo periodika v rámci svazku

1

Stát vydavatele periodika

PL - Polská republika

Počet stran výsledku

16

Strana od-do

124-139

Kód UT WoS článku

—

EID výsledku v databázi Scopus

2-s2.0-85044836726