Abstract
The concept of interest rate parity is an important component of the macroeconomic analysis for open economies and one of the basic models used in international finance. The validation of interest parity has important implications for both international corporate finance decisions and international investments. Interest rate parity has been developed in two forms, known as covered interest parity (CIP) and uncovered interest parity (UIP), which provide simple relationships between money market variables, more specifically interest rates, and foreign exchange market prices.
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© 2010 Alexandra Horobet, Sorin Dumitrescu and Dan Gabriel Dumitrescu
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Horobet, A., Dumitrescu, S., Dumitrescu, D.G. (2010). Implications of Volatility for Uncovered Interest Parity Testing. In: Matousek, R. (eds) Money, Banking and Financial Markets in Central and Eastern Europe. Palgrave Macmillan Studies in Banking and Financial Institutions. Palgrave Macmillan, London. https://doi.org/10.1057/9780230302211_12
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DOI: https://doi.org/10.1057/9780230302211_12
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