*Monetary Policy and the Sterling Exchange Rate

4 Pages Posted: 2 Jun 2006

See all articles by David Cobham

David Cobham

Heriot-Watt University - School of Management and Languages


This article introduces the three contributions to the Feature, which address issues raised by the sterling appreciation of 1996-97 and the subsequent prolonged overvaluation. Cobham discusses the MPC's understanding of exchange rate changes and examines policy makers' responses to the proposal that policy should respond to exchange rate misalignments. Kirsanova, Leith and Wren-Lewis construct a new open economy macroeconomics model with international risk sharing shocks, in which the welfare function derived includes a term in the terms of trade gap. Allsopp, Kara and Nelson investigate the exchange rate-prices pass-through and how imports should be modelled, and draw out the policy implications.

Suggested Citation

Cobham, David, *Monetary Policy and the Sterling Exchange Rate. Economic Journal, Vol. 116, No. 512, pp. F181-F184, June 2006, Available at SSRN: https://ssrn.com/abstract=905966 or http://dx.doi.org/10.1111/j.1468-0297.2006.01095.x

David Cobham (Contact Author)

Heriot-Watt University - School of Management and Languages ( email )

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United Kingdom
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HOME PAGE: http://www.sml.hw.ac.uk/Staff_Profiles/DavidCobham.html

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