Optimal size of currency swap between central banks: evidence from China/ created by Jie Yang and Liyan Han
Material type:
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- volume
- 13504851
- HB1.A666 APP
Item type | Current library | Call number | Vol info | Copy number | Status | Notes | Date due | Barcode | |
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Main Library - Special Collections | HB1.A666 APP (Browse shelf(Opens below)) | Vol. 20, no.1 (pages203-207) | SP17971 | Not for loan | For in house use only |
Currency swaps are used by central banks to provide short-term liquidity to help enhance financial stability for both counterparts. We apply the newsboy inventory optimization to interpret the factors related to the optimal size of a currency swap, and we find that the mean value of foreign exchange demand, its volatility and the distribution form are important for the optimal swap size. Empirical studies regarding swap arrangements between China and its trading partners show that total trade volume and its long-term SD are robust explanatory variables.
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