In this paper, we study how the volatility of both realized and expected macroeconomic variables relates to the variation in exchange rate volatility through the prism of the Great Moderation hypothesis. We find significant heterogeneity in exchange rate trend volatility across currency pairs...

Observed international investment positions and cross-country heterogeneity in rates of return to capital are hard to reconcile with frictionless capital markets. In this paper, we develop a theory of international capital allocation: a multi-country dynamic spatial general equilibrium model in...

The global economy is facing increased economic policy uncertainty in a phase of already moderate momentum. The announcements made by the incoming US administration are the main reason for this. However, it is unclear what measures will actually be taken. This forecast is based on the assumption...