Abstract

http://ssrn.com/abstract=2155645
 


 



Currency Intervention and the Global Portfolio Balance Effect: Japanese Lessons


Petra Gerlach-Kristen


Swiss National Bank

Robert N. McCauley


Bank for International Settlements (BIS)

Kazuo Ueda


University of Tokyo - Faculty of Economics

October 1, 2012

BIS Working Paper No. 389

Abstract:     
This paper shows that the Japanese foreign exchange interventions in 2003/04 seem to have lowered long-term interest rates in a wide range of countries, including Japan. It seems that this decline was triggered by the investment of the intervention proceeds in US bonds and that a global portfolio balance effect spread the resulting decline in US yields to other bond markets, thus easing global monetary conditions.

Number of Pages in PDF File: 17

Keywords: Intervention, portfolio balance effect, Japan

JEL Classification: E5, G12, O24

Accepted Paper Series


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Date posted: October 26, 2012  

Suggested Citation

Gerlach-Kristen, Petra and McCauley, Robert N. and Ueda, Kazuo, Currency Intervention and the Global Portfolio Balance Effect: Japanese Lessons (October 1, 2012). BIS Working Paper No. 389. Available at SSRN: http://ssrn.com/abstract=2155645

Contact Information

Petra Gerlach-Kristen (Contact Author)
Swiss National Bank ( email )
Borsenstrasse 15
CH-8022 Zurich
Switzerland
Robert N. McCauley
Bank for International Settlements (BIS) ( email )
CH-4002 Basel, Basel-Stadt
Switzerland
Kazuo Ueda
University of Tokyo - Faculty of Economics ( email )
7-3-1 Hongo, Bunkyo-ku
Tokyo 113-0033
Japan
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