Exchange rate movements as explained by dealers

Economic Papers (Economic Society of Australia), Sept, 2003 by Tiffany Hutcheson

(1) This is a good response as mail surveys rarely get response rates greater than 30 per cent (Alreck and Settle, 1985).

(2) The surveys include those undertaken by Taylor and Allen (1992) and Cheung, Chinn and Marsh (1999) on London dealers, Cheung and Wong (2000) on dealers in Singapore, Tokyo and Hong Kong, and Cheung and Chinn (2001) on dealers in the United States.

(3) Other reasons given were market sentiment, the longer time needed to complete large orders, view of fund managers, capital flows and technical breaks in a particularly long or short market.

(4)These were announcements made by the Federal Open Market Committee (FOMC) meeting in the United States of America and the Bank of Japan's Tankan announcement.

(5) Respondents were given the option of choosing economic announcements from a foreign country other than the USA but none of the respondents took up this option.

(6) A small number of respondents selected more than one factor for each time horizon. Their responses were not recorded.

(7) Option positions were the other factor considered to have an impact on intra-day and medium run exchange rate movements.

References

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