TY  - JOUR
AU  - Cumby,Robert E.
AU  - Obstfeld,Maurice
TI  - Exchange-Rate Expectations and Nominal Interest Differentials: A Test ofthe Fisher Hypothesis
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 537
PY  - 1981
Y2  - November 1981
UR  - http://www.nber.org/papers/w0537
L1  - http://www.nber.org/papers/w0537.pdf
N1  - Author contact info:
Robert E. Cumby
Georgetown University
School of Foreign Service
Washington, DC 20057-1045
Tel: 202/687-2990
Fax: 202/687-6102
E-Mail: cumbyr@georgetown.edu

Maurice Obstfeld
Department of Economics
University of California, Berkeley
530 Evans Hall #3880
Berkeley, CA 94720-3880
Tel: 510/643-9646
Fax: 510/642-6615
E-Mail: obstfeld@econ.berkeley.edu
AB  - This note tests the hypothesis that nominal interest differentials between similar assets denominated in different currencies can be explained entirely by the expected change in the exchange rate over the holding period. This proposition, often called the "Fisher open" hypothesis or the hypothesis of perfect asset substitutability, has been a major component of recent theories of exchange-rate determination, and has important implications for monetary policy.
ER  -