International Monetary Economics

AY2015/2016 Semester 1

This course offers a systematic analysis of theories on international money and finance. Topics covered include balance of payment; the foreign exchange market; hedging and speculation; interest arbitrages; the J-curve effect; the Marshall-Lerner condition; the absorption approach; internal and external balance; adjustment mechanisms under the fixed and flexible exchange rate systems; long-run determinants of the exchange rate; the monetary approach; the asset market approach; the role of market fundamentals, expectations and news of exchange rate and asset price movements; the theory of optimal currency area; financial crises; Singapore's exchange rate system.