We analyse the fuctioning of the Belgian franc in the European Monetary System between 1979 and 1991. A discrete time target zone model which captures the features displayed by the continuous time models is combined with intervention data provided by the Belgian central bank. Simple prediction formulas are derived to calculate one-week-ahead conditional probabilities on a realignment of the Belgian franc relative to the Deutsche mark. The devaluation probabilities are matched with the intervention data. We find support fo rhte notion that Belgian intervention policy was a policy of leaning against the wind.
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