Following the collapse of the socialist system,foreign exchange markets in most post-transitioneconomies have experienced periods of turbulence andinstability. These developments have increased theinterest of the public and policymakers to identifythe key factors driving risks in the foreign exchangemarkets. Although there are numerous studiesanalyzing determinants of foreign exchange risks inthe context of developed economies, the issue remainsto be relatively unexplored in the context ofemerging markets. The aim of this book is to fillthis gap in the literature and to provide systematicempirical evidence on the factors driving foreignexchange risks in post-transition countries.Application of modern empirical techniques to uniquedata allows us to expand our understanding of theorigins of foreign exchange risks in countries withunderdeveloped financial markets. The book should beespecially useful for academic community andpolicymakers in post-transition economies, foreignexchange traders and international investorsexpanding their activities to post-transitioneconomies, or anyone else interested in analyzingforeign exchange markets.