Cover -- Rouledge Library Editions -- Half Title -- Copyright -- Title -- Copyright1 -- Contents -- Abbreviations -- About the Authors -- Foreword -- Chapter 1 Introduction -- The Structure of the Book -- Why Exchange Markets are Intrinsically Complicated -- The Genesis of Exchange Rate Systems -- The Fixed but Adjustable System -- Exchange Rate Policy under Floating Exchange Rates -- Currency Flows Arise for other Reasons than the Financing of Trade -- Is There More to Exchange Rate Theory than PPP? -- Part 1 Exchange Rate Determination: Theory and Evidence -- Chapter 2 The Spot Market, the Forward Market and the Capital Account -- Introduction -- Definitions and Notation -- Forward Markets -- Covered Interest Arbitrage and the Demand for Spot Currency -- Speculative Capital Flows in the Spot Market -- Direct Investment -- Summary and Conclusions -- Chapter 3 Theories of the Determination of the Forward Rate and Spot Capital Flows -- Introduction -- The Modem Theory of the Forward Rate -- Testing the Modem Theory of the Forward Exchange Rate -- Capital Flows in the Spot Market: Empirical Tests -- Policy Implications -- The Forward Market, Bank Arbitrage and Transactions Costs -- Summary and Conclusions -- Chapter 4 International Monetary Models -- Current Account Monetary Models, CAM -- Capital Account Monetarist Models, KAM -- Chapter 5 Asset Markets, the Efficient Markets Hypothesis and 'News' -- Introduction -- Rational Expectations Hypothesis, REH -- The Efficient Markets Hypothesis: EMH -- Exchange Rates and News -- Summary and Conclusions -- Part 1: Further Reading -- Part 2 Alternative Exchange Rate Regimes -- Chapter 6 The Evolution of the Exchange Rate System Since the Second World War -- The Bretton Woods System -- Gold and Gold Standards -- The Collapse of the Bretton Woods System