Does Foreign Exchange Reserve Decumulation Lead to Currency Appreciation?
---- Acknowledgments ----
We thank the Czech National Bank, particularly Governor Zdenek Tuma, for access to the official intraday reserve sales data and for very helpful discussions. We have also benefitted from discussions with Karel Bauer and Petr Frydrych of the Czech National Bank. An early version of the paper was presented at the Bank of Japan, the Federal Reserve Bank of St. Louis, and the IMF, we thank seminar participants for very useful comments. We are grateful to the International Policy Center at the Ford School of Public Policy for financial support and Fatum gratefully acknowledges funding from Social Sciences and Humanities Research Council of Canada (SSHRC). Thomas Bridges and Brian Wojcik provided outstanding research assistance. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.