[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"detail-sidebar-cat-0-en-105":3,"doc-seo-324627-105":59,"doc-detail-324627-en":131},{"code":4,"msg":5,"data":6},0,"success",[7,13,18,23,28,33,38,43,48,51,55],{"id":8,"doc_module":4,"doc_module_name":9,"category_name":10,"show_sort_weight":11,"slug":12},1,"Document","Story & Novel",90,"story-novel",{"id":14,"doc_module":4,"doc_module_name":9,"category_name":15,"show_sort_weight":16,"slug":17},2,"Literature",80,"literature",{"id":19,"doc_module":4,"doc_module_name":9,"category_name":20,"show_sort_weight":21,"slug":22},4,"Exam",70,"exam",{"id":24,"doc_module":4,"doc_module_name":9,"category_name":25,"show_sort_weight":26,"slug":27},5,"Comic",60,"comic",{"id":29,"doc_module":4,"doc_module_name":9,"category_name":30,"show_sort_weight":31,"slug":32},6,"Technology",50,"technology",{"id":34,"doc_module":4,"doc_module_name":9,"category_name":35,"show_sort_weight":36,"slug":37},7,"Healthcare",40,"healthcare",{"id":39,"doc_module":4,"doc_module_name":9,"category_name":40,"show_sort_weight":41,"slug":42},8,"Research & Report",30,"research-report",{"id":44,"doc_module":4,"doc_module_name":9,"category_name":45,"show_sort_weight":46,"slug":47},9,"Religion & Spirituality",20,"religion-spirituality",{"id":46,"doc_module":4,"doc_module_name":9,"category_name":49,"show_sort_weight":46,"slug":50},"World Cup","world-cup",{"id":52,"doc_module":4,"doc_module_name":9,"category_name":53,"show_sort_weight":52,"slug":54},10,"Lifestyle","lifestyle",{"id":56,"doc_module":4,"doc_module_name":9,"category_name":57,"show_sort_weight":24,"slug":58},19,"General","general",{"code":4,"msg":60,"data":61},"ok",{"site_id":62,"language":63,"slug":64,"title":65,"keywords":66,"description":67,"schema_data":68,"social_meta":124,"head_meta":126,"extra_data":128,"updated_unix":130},105,"en","intervention-and-exchange-rates-whats-the-connection","Intervention and Exchange Rates - What's the Connection?","","Central banks intervene in foreign exchange markets by buying and selling currencies to influence exchange rates, sometimes risking substantial losses. Whether intervention creates more stable, predictable rates remains debated: critics argue policy moves are small relative to market flows and independent of monetary and fiscal policy, while proponents cite episodes such as the dollar’s depreciation around 1985. An economic commentary reviews U.S. intervention from August 1984 to August 1987, finding no systematic link day to day, but temporary effects in some cases.",{"@graph":69,"@context":123},[70,84,106],{"@type":71,"itemListElement":72},"BreadcrumbList",[73,77,79,82],{"item":74,"name":75,"@type":76,"position":8},"https://docshare.wps.com","Home","ListItem",{"item":78,"name":9,"@type":76,"position":14},"https://docshare.wps.com/document/",{"item":80,"name":40,"@type":76,"position":81},"https://docshare.wps.com/document/research-report/",3,{"item":83,"name":65,"@type":76,"position":19},"https://docshare.wps.com/document/intervention-and-exchange-rates-whats-the-connection/324627/",{"url":83,"name":65,"@type":85,"image":86,"author":91,"headline":65,"publisher":94,"fileFormat":97,"inLanguage":63,"description":67,"dateModified":98,"datePublished":99,"encodingFormat":97,"isAccessibleForFree":100,"interactionStatistic":101},"DigitalDocument",{"url":87,"@type":88,"width":89,"height":90},"https://docshare.wps.com/thumbnails/intervention-and-exchange-rates-whats-the-connection/324627.png","ImageObject",300,407,{"name":92,"@type":93},"Maeve","Person",{"url":74,"name":95,"@type":96},"DocShare","Organization","application/pdf","2026-10-29","2026-09-21",true,{"@type":102,"interactionType":103,"userInteractionCount":105},"InteractionCounter",{"@type":104},"ViewAction",14,{"@type":107,"mainEntity":108},"FAQPage",[109,115,119],{"name":110,"@type":111,"acceptedAnswer":112},"Do day-to-day U.S. intervention actions reliably move exchange rates?","Question",{"text":113,"@type":114},"Evidence indicates day-to-day U.S. intervention was not systematically related to day-to-day exchange-rate movements during the study period.","Answer",{"name":116,"@type":111,"acceptedAnswer":117},"How can central-bank intervention affect exchange rates if money supplies are neutralized?",{"text":118,"@type":114},"Even when money supplies remain unchanged, neutralization can shift the composition of government bonds denominated in different currencies, which may influence exchange rates under certain market conditions.",{"name":120,"@type":111,"acceptedAnswer":121},"Why might intervention temporarily affect exchange-rate quotes?",{"text":122,"@type":114},"Intervention can alter expectations by improving information flow or providing new information in a disorderly market, but it requires participants to believe authorities have better information or influence attitudes about future policies.","https://schema.org",{"og:url":83,"og:type":125,"og:title":65,"og:site_name":95,"og:description":67},"article",{"robots":127,"canonical":83},"index,follow",{"doc_id":129,"site_id":62},324627,1790153276,{"code":4,"msg":5,"data":132},{"doc_id":129,"user_id":133,"nickname":92,"user_avatar":134,"doc_module":4,"category_id":39,"category_name":40,"doc_title":65,"doc_description":67,"doc_content":135,"file_id":136,"file_url":137,"file_type":138,"file_size":139,"view_count":105,"is_deleted":4,"is_public":8,"is_downloadable":8,"audit_status":8,"page_count":24,"language":140,"language_code":63,"site_id":62,"html_lang":63,"table_of_contents":141,"faqs":142,"seo_title":143,"seo_description":67,"update_tm":144,"read_time":145,"preview_page_count":4},5909877438554,"https://ap-avatar.wpscdn.com/avatar/5600025385ad2bf12a7?_k=1778553567797529272","Intervention andthe Dollar  \nby Owen F.Humpage  \nCentral banks ofen interene inthe foreign-exchange market,buyingand selling currencies in an effort toinfluence the exchange rates.Thesetransactions can involve billions ofdollars and can risk substantial lossesfor central banks should they end upholding a currency that depreciates.  \nWhether or not central-bank interven-tion produces a more stable,morepredictable exchange rate is not clearand is a subject of debate amongeconomists.Many argue that interven-tion,as a policy independent ofmonetary and fiscal policies,haslittle,if any,effect on exchange rates.Thescale of intervention is often smallrelative to the scale of the markettransactions,and past studies suggestthat systematic intervention cannotsupplant fundamental market forces.  \nProponents of intervention,however,point to recent US.experiences asevidence that intervention affectsexchange rates.They contend thatcentral-bank intervention in late 1985contributed to the dollar's deprecia-tion and that heavy central-bankintervention last year helped stabilizethe dollar.Although a cursory look atthe evidence might lead one to thisview,a close inspection reveals only aweak,and quickly dissipating rela-tionship between intervention andthe dollar's movements during thisperiod.  \nThis Economic Commentarysummar-izes the findings from a recent studyof U.S.intervention between August1984 and August 1987.The evidenceindicates that day-to-day US.interven-tion was not systematically related today-to-day exchange-rate movements,but that intervention in some casesdid seem to affect exchange ratestemporarily.By reviewing the circumstances and events surrounding eachepisode of US.intervention,one canlearn about how,and when,centralbanks might successfully employ anintervention policy.  \n# ■Intervention and Exchange Rates:What's the Connection?\n\nIntervention purchases and sales ofcurrencies have the potential to alterthe money supplies of the countrieswhose currencies were bought andsold.Such money-supply changescould have a strong influence onexchange rates,which,after all,arethe price of one nation's money interms of another.  \nIf this were the extent of the opera-tions,we would have little more towrite about.Central banks,however,routinely attempt to neutralize theeffects of intervention on their moneysupplies through transactions withother,more conventional instrumentsof monetary policy.For example,if  \nDoes U.S.intervention have a lastingeffect on the foreign-exchange valueof the dollar that is independent ofmonetary policy actions?The authorexamines evidence from a recentstudy of U.S.intervention during athree-year period and discusses therelationship between interventionand exchange rates.  \nthe Federal Reserve wishes to preventan intervention purchase of WestGerman marks from increasing theU.S.money supply,it can sell anequivalent dollar amount of U.S.Treasury securities through open-market operations.The sale of Treas-ury securities reduces the US.moneysupply.Countries usually neutralizethe monetary effects of interventionbecause they wish to focus theirmonetary policies on domestic objectives,such as preventing inflation orpromoting growth,and because theybelieve that they can conduct anindependent intervention policysuccessfully.  \nAlthough money supplies remainunchanged,the process of neutraliz-ing the monetary effects of interven-tion alters the supply of govermmentbonds denominated in one currencyrelative to the supply of bondsdenominated in another currency.Inour example above,the FederalReserve increased the amount of US.Treasury securities in the marketIfnecessary,Germany also might offsetany impact of intervention on itsmoney supply by reducing theamount of German treasury securitiesin the market.Under certain condi-tions,generally thought to exist in theexchange markets,the changing cur-rency composition of bonds in themarket could alter exchange rates.2  \nIntervention also can influenceexchange rates by altering expectati","cbCaicwfU3AVn3L1","https://ap.wps.com/l/cbCaicwfU3AVn3L1","pdf",1133034,"English","# ■Intervention and Exchange Rates:What's the Connection?\n## Intervention purchases and exchange-rate channels\n## Neutralizing monetary effects of intervention\n## Expectations and market information\n## No systematic relationship during depreciation","[{\"question\":\"Do day-to-day U.S. intervention actions reliably move exchange rates?\",\"answer\":\"Evidence indicates day-to-day U.S. intervention was not systematically related to day-to-day exchange-rate movements during the study period.\"},{\"question\":\"How can central-bank intervention affect exchange rates if money supplies are neutralized?\",\"answer\":\"Even when money supplies remain unchanged, neutralization can shift the composition of government bonds denominated in different currencies, which may influence exchange rates under certain market conditions.\"},{\"question\":\"Why might intervention temporarily affect exchange-rate quotes?\",\"answer\":\"Intervention can alter expectations by improving information flow or providing new information in a disorderly market, but it requires participants to believe authorities have better information or influence attitudes about future policies.\"}]","Intervention and Exchange Rates - What's the Connection? | PDF",1789968439,13]