@article{Microstructure:908,
      recid = {908},
      author = {D'Souza, Chris},
      title = {A Market Microstructure Analysis of Foreign Exchange  Intervention in Canada},
      publisher = {Bank of Canada},
      address = {2002},
      pages = {1 online resource (vi, 65 pages)},
      abstract = {This paper clarifies the role and the impact of foreign  exchange dealers in the relationship between foreign  exchange intervention and nominal exchange rates using a  unique dataset that disaggregates trades by dealer and by  type of trade. The paper tests a number of market  microstructure hypotheses. Results suggest that central  bank orders and other customer orders are treated similarly  by dealers who are engaged in short-run speculative and  risk-sharing-motivated interdealer trading. While private  payoff-relevant information is contained in trades,  speculative interdealer trading is based only on transitory  non-payoff-relevant information. A central bank considering  intervention must consider both the signal it wishes to  convey to the market and the subsequent trading strategies  utilized by dealers.},
      url = {http://www.oar-rao.bank-banque-canada.ca/record/908},
      doi = {https://doi.org/10.34989/swp-2002-16},
}