Valutarisiko, valutagæld og rentespænd ("Exchange Rate Risk, Foreign Exchange Debt, and the Interest Rate Differential")

By Lars Tyge Nielsen

Nationaløkonomisk Tidsskrift 127 (1989), 346-355

Abstract

How is the net investment in DKK bonds by foreigners affected by the interest rate differential? Will increased confidence in the exchange value of the DKK lead to additional investment by foreigners? Will it lead the domestic private sector to change its portfolio from net claims in DKK to net debt in DKK? These questions are addressed by means of a portfolio selection model with two assets, namely, nominal claims denominated in DKK and in foreign currency