Exchange rate channel losing traction in Euro area and Japan – SocGen

By FXStreet Alvin T. Tan, Research Analyst at Societe Generale, suggests that the unconventional monetary policy appears to be losing traction in both the Euro area and Japan.

Key Quotes

“The collapse in nominal interest rates in the two economies has meant a greater dependence on the exchange rate channel to effectuate monetary policy easing. However, neither the trade weighted euro nor yen has depreciated over the past twelve months, despite large-scale asset purchases and deepening negative interest rates.”
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Source:: FX Street