Date of Award

2022

Document Type

Masters Thesis

Degree Name

M.A.

Organizational Unit

College of Arts Humanities and Social Sciences, Economics

First Advisor

Yeo Hyub Yoon

Second Advisor

Yavuz Yasar

Third Advisor

Chiara Piovani

Fourth Advisor

Rafael Ioris

Keywords

U.S. economics, Finance, Exchange rate

Abstract

The purpose of this thesis is to explore how US financial activity influences the exchange rates of foreign nations. Starting off by building on Currency Hierarchy and Minskyan dynamics, I look at how financial cycles generated in the US, the key economy, transmit liquidity towards economies on the periphery. Additionally, I use the increase in shadow banking asset accumulation relative to commercial banking asset accumulation as indicative of financial expansions in the US, and the driving force of financial cycles. Using vector autoregression (VAR) analysis I test the relationships between the ratio of US shadow banking assets relative to commercial banking assets, portfolio investment liabilities, and the exchange rates for South Korea, Mexico, India and Brazil. I find that US finance has a negative impact on the exchange rates for South Korea, Mexico, and India.

Publication Statement

Copyright is held by the author. User is responsible for all copyright compliance.

Rights Holder

Matthew Brill

Provenance

Received from ProQuest

File Format

application/pdf

Language

en

File Size

130 pgs

Discipline

Economics, Finance, International relations

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