RDP 8612: A Weekly Model of the Floating Australian Dollar
Equation (19)
∇
e
t
+
1
=
1
β
[
α
0
+
α
e
e
t
−
1
+
α
m
m
t
−
α
y
Y
t
−
α
m
*
m
t
*
+
α
y
*
y
t
*
]
+
K
m
t
Fm
t
+
1
−
K
y
t
FY
t
−
K
m
*
t
Fm
t
+
1
*
+
K
y
*
t
FY
t+1
*
+
u
t
+
1
+
(
1
−
R
1
)
u
t
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