Co-integration and Uncovered Interest Parity in Colombian Economy 2000-2005

Abstract

This paper analyzes the Uncovered Interest Parity hypothesis between Colombia and the United States during 2000-2005.  This was done with the econometrics co-integration methodology; specifically, the methodology used was the one developed by Engle and Granger (1987) and the one used by Johansen (1988). Empirical evidence states that under both methodologies used, the hypothesis is rejected.