The DM/Dollar Rate and the Exchange Market Intervention Policy of the Deutsche Bundesbank 1974–1984

  • Manfred Willms
Part of the Studies in Banking and International Finance book series (SBIF)


World-wide disappointment has taken place with respect to the working of the flexible exchange rate system since 1973. Most of the expected effects did not occur. Instead of the anticipated smooth movement, wide swings and high short-run fluctuations of both nominal and real exchange rates could be observed. Deviations from purchasing power parity did not only become a short-run phenomenon of. overshooting but lasted for long periods. In addition, substantial deficits and surpluses in the current account and the capital account occurred in the flexible exchange rate system as they did before under fixed exchange rates. Thus flexible exchange rates were not able to prevent the transfer of international disturbances across countries.


Exchange Rate Interest Rate Real Exchange Rate Real Interest Rate Purchasing Power Parity 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


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Copyright information

© Donald R. Hodgman and Geoffrey E. Wood 1987

Authors and Affiliations

  • Manfred Willms

There are no affiliations available

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