nr 033- Were Verbal Efforts to Support the Euro Effective? A High-Frequency Analysis of ECB Statements
- DNB Working Papers
-
Date 26 April 2005
This paper studies the effects of verbal interventions by European
cen- tral bankers on high-frequency euro-dollar exchange rates. We
find that ECB verbal interventions have had only small and
short-lived effects. Ver- bal interventions which are reported in
news report headlines are more likely to be successful, whereas
verbal interventions on days with releases of macroeconomic data
are less successful. There is no difference in the effects of
comments by members of the ECB Executive Board and presi- dents of
national central banks. JEL classifications: E58, F31, C14
Keywords: verbal intervention, high-frequency exchange rates,
European Central Bank, sign test