Foreign exchange expectations in Indonesia : regime switching chartists & fundamentalists approach

Deskripsi

effec In this research, the of central bank intervention within a heterogeneous expectation exchange rate model is investigated. The results are supporting both chartists and fundamentalist regimes. In the period investigated, chartist dominates in determining the exchange rate. While BI foreign exchange intervention can effectively push the market exchange-rate to its long-run fundamental equilibrium, however, Bank Indonesia?s effort to exert a stabilizing effec of foreign exchange interventions, the result does not show a success..