International Finance
... Capital Account (Prior to 1999, this was part of Current Account.) This is a very small account that includes debt forgiveness, and goods and financial assets accompanying migrants when they enter or leave the country. Financial Account (Prior to 1999, this was called the Capital Account.): U.S.-own ...
... Capital Account (Prior to 1999, this was part of Current Account.) This is a very small account that includes debt forgiveness, and goods and financial assets accompanying migrants when they enter or leave the country. Financial Account (Prior to 1999, this was called the Capital Account.): U.S.-own ...
Economics 132.03 Principles of Macroeconomics
... a. As a first step in computing the consumer price index (CPI), the Bureau of Labor Statistics surveys consumers to determine the “basket of goods” purchased by a typical consumer. Using 2006 as your base year, what is the basket of goods in this economy? b. What is the cost of the basket in each ...
... a. As a first step in computing the consumer price index (CPI), the Bureau of Labor Statistics surveys consumers to determine the “basket of goods” purchased by a typical consumer. Using 2006 as your base year, what is the basket of goods in this economy? b. What is the cost of the basket in each ...
The Monetary and Fiscal History of Venezuela 1960–2005
... In the post-war era, Venezuela represents one of the most dramatic growth experiences in the world. Measured as real gross domestic product per capita (GDP) in international dollars, Venezuela attained levels of more than 80 percent of that of the United States by the end of 1960. It has also experi ...
... In the post-war era, Venezuela represents one of the most dramatic growth experiences in the world. Measured as real gross domestic product per capita (GDP) in international dollars, Venezuela attained levels of more than 80 percent of that of the United States by the end of 1960. It has also experi ...
Saving and Investment in the Open Economy
... • Why did things go wrong for the LDCs in the late 1970s early 1980s – Adverse shocks (world wide downturn); – Sharp increase in interest rates (debt was floating rate); and – Loans may not have been made and used wisely. ...
... • Why did things go wrong for the LDCs in the late 1970s early 1980s – Adverse shocks (world wide downturn); – Sharp increase in interest rates (debt was floating rate); and – Loans may not have been made and used wisely. ...
NBER WORKING PAPER SERIES Pierpaolo Benigno Working Paper 12219
... ence of the US economy valuation effects have accounted for a large fraction of the changes in the international investment position of the country and have concluded that a depreciation of the US dollar can ease the real adjustment needed to reduce the external imbalances.3 As pointed out by Obstfe ...
... ence of the US economy valuation effects have accounted for a large fraction of the changes in the international investment position of the country and have concluded that a depreciation of the US dollar can ease the real adjustment needed to reduce the external imbalances.3 As pointed out by Obstfe ...
PDF
... China’s domestic income has also been directed towards investment rather than consumption, To some extent, this is a function of the government role in lending decisions, but also reflects China’s limited social safety net, and its macro-economic policies. Among these policies are capital controls— ...
... China’s domestic income has also been directed towards investment rather than consumption, To some extent, this is a function of the government role in lending decisions, but also reflects China’s limited social safety net, and its macro-economic policies. Among these policies are capital controls— ...
monetary models of dollar/yen/euro nominal exchange rates
... Do the dif®culties that researchers have faced in estimating monetary exchange-rate models imply that monetary models have no relevance and should be abandoned? Certainly not. First of all, even if the models do not have much power in empirically explaining cross rates between the yen, dollar and th ...
... Do the dif®culties that researchers have faced in estimating monetary exchange-rate models imply that monetary models have no relevance and should be abandoned? Certainly not. First of all, even if the models do not have much power in empirically explaining cross rates between the yen, dollar and th ...
1 Is a Change in the Renminbi Exchange Rate in China`s Interest?1
... But as the capital account grows more porous, tightening domestic credit conditions by selling short-term bills and three-year sterilization bonds just strengthens the tendency for capital to flow in. While the PBOC has been working hard to sterilize capital inflows, it has been only partially succe ...
... But as the capital account grows more porous, tightening domestic credit conditions by selling short-term bills and three-year sterilization bonds just strengthens the tendency for capital to flow in. While the PBOC has been working hard to sterilize capital inflows, it has been only partially succe ...
Foreign Exchange Outlook - Global Banking and Markets
... Faced with rising uncertainty, building disinflationary pressures and uneven growth, global central banks are shifting course and foreign exchange markets are reacting. January was marked by surprising turns in central bank policy globally, which drove volatility higher and supported a further stren ...
... Faced with rising uncertainty, building disinflationary pressures and uneven growth, global central banks are shifting course and foreign exchange markets are reacting. January was marked by surprising turns in central bank policy globally, which drove volatility higher and supported a further stren ...
View/Open
... For a country incurring a net savings deficit, such as the U.S., a number of characteristics help to supply the necessary external demand. One is the dollar serves as the world's numeraire currency. Another is fiscal deficits (which approached 5 percent of GDP by 2008), as well as relatively efficie ...
... For a country incurring a net savings deficit, such as the U.S., a number of characteristics help to supply the necessary external demand. One is the dollar serves as the world's numeraire currency. Another is fiscal deficits (which approached 5 percent of GDP by 2008), as well as relatively efficie ...
Currency misalignment: The China case
... enough to absorb domestically produced goods and services, targeting foreign markets can be considered as a good strategy to increase production to stimulate the economy. But it is not that easy to reach these higher export targets. Countries aiming at export-oriented growth have to aggressively com ...
... enough to absorb domestically produced goods and services, targeting foreign markets can be considered as a good strategy to increase production to stimulate the economy. But it is not that easy to reach these higher export targets. Countries aiming at export-oriented growth have to aggressively com ...
Chapter 2
... • However, a weak home currency may not necessarily improve a trade deficit. ¤ Foreign companies may lower their prices to maintain their competitiveness. ¤ Some other currencies may weaken too. ¤ Many trade transactions are prearranged and cannot be adjusted immediately. This is known as the J-curv ...
... • However, a weak home currency may not necessarily improve a trade deficit. ¤ Foreign companies may lower their prices to maintain their competitiveness. ¤ Some other currencies may weaken too. ¤ Many trade transactions are prearranged and cannot be adjusted immediately. This is known as the J-curv ...
Núm. 862 2015 - Banco de la República
... is ever binding). Generally, this strand of literature employs no-arbitrage conditions, such as the uncovered interest rate parity, but with no risk premium. Hence, agents are indifferent between holding foreign and domestic assets as long as they guarantee the same level of consumption in each stat ...
... is ever binding). Generally, this strand of literature employs no-arbitrage conditions, such as the uncovered interest rate parity, but with no risk premium. Hence, agents are indifferent between holding foreign and domestic assets as long as they guarantee the same level of consumption in each stat ...
Purchasing Power Parity Page 1 of 3
... government to lower trade barriers and, in the long-run, this equation would be something that the economy would approach. Well, typically, that’s true. Typically, economies do move in the direction in the long run, given time, toward purchasing power parity, toward an alignment of prices and exchan ...
... government to lower trade barriers and, in the long-run, this equation would be something that the economy would approach. Well, typically, that’s true. Typically, economies do move in the direction in the long run, given time, toward purchasing power parity, toward an alignment of prices and exchan ...
The Curious Case of the Yen as a Safe Haven Currency
... That is rightly so. Since 2008, the yen appreciated steadily against the U.S. dollar in effective terms in the aftermath of various shocks. First, the global financial crisis was associated with a large real exchange rate appreciation by over 20 percent. Second, in May 2010, higher market distress a ...
... That is rightly so. Since 2008, the yen appreciated steadily against the U.S. dollar in effective terms in the aftermath of various shocks. First, the global financial crisis was associated with a large real exchange rate appreciation by over 20 percent. Second, in May 2010, higher market distress a ...
NBER WORKING PAPER SERIES FEAR OF SUDDEN STOPS: Ricardo Caballero
... Latin American economies are exposed to substantial external vulnerability. Domestic imbalances and terms of trade shocks are often exacerbated by sudden financial distress. In this paper we explore ways of overcoming external vulnerability, drawing lessons from a detailed comparison of the response ...
... Latin American economies are exposed to substantial external vulnerability. Domestic imbalances and terms of trade shocks are often exacerbated by sudden financial distress. In this paper we explore ways of overcoming external vulnerability, drawing lessons from a detailed comparison of the response ...
Exchange rate volatility and economic performance in Peru: A firm
... countries during a period of 1990-1999, found evidence that firms holding dollar-denominated debt during a exchange rate realignment consistently increased their capital expenditures. This finding is at odds with the predictions of the theory, given the deterioration of firms´ net worth. In their v ...
... countries during a period of 1990-1999, found evidence that firms holding dollar-denominated debt during a exchange rate realignment consistently increased their capital expenditures. This finding is at odds with the predictions of the theory, given the deterioration of firms´ net worth. In their v ...
Practice Final Exam Economics 503 Fundamentals of Economic
... Since the mid-1990’s, the United Kingdom has followed a monetary policy of “inflation targeting.” The way we might think of this policy, the central bank will choose some price level P* and to set monetary policy to keep the equilibrium price level in the economy near P*. When the price level threat ...
... Since the mid-1990’s, the United Kingdom has followed a monetary policy of “inflation targeting.” The way we might think of this policy, the central bank will choose some price level P* and to set monetary policy to keep the equilibrium price level in the economy near P*. When the price level threat ...
The advantages of a small European Monetary Union
... costs of a multiple-currency system for all the enterprises affected should be between 0.5 and 1% of their trade turnover, s Foreign exchange commissions for individuals are far higher than for firms, since individuals transfer only relatively small amounts and often require banknotes, for which the ...
... costs of a multiple-currency system for all the enterprises affected should be between 0.5 and 1% of their trade turnover, s Foreign exchange commissions for individuals are far higher than for firms, since individuals transfer only relatively small amounts and often require banknotes, for which the ...
Final Exam
... Please write your answers on this exam paper. Graphing Questions Since the mid-1990’s, the United Kingdom has followed a monetary policy of “inflation targeting.” The way we might think of this policy, the central bank will choose some price level P* and to set monetary policy to keep the equilibri ...
... Please write your answers on this exam paper. Graphing Questions Since the mid-1990’s, the United Kingdom has followed a monetary policy of “inflation targeting.” The way we might think of this policy, the central bank will choose some price level P* and to set monetary policy to keep the equilibri ...
Timothy Boobier Grazia Manisera Steffy Ndjotong
... equity investment, whereas ‘total’ includes debt as well) were much higher to rich countries relative to poor countries, and this is while equity inflows made up a larger proportion of total inflows for poor countries as well. Contradicting the neoclassical model, this is a stark demonstration of th ...
... equity investment, whereas ‘total’ includes debt as well) were much higher to rich countries relative to poor countries, and this is while equity inflows made up a larger proportion of total inflows for poor countries as well. Contradicting the neoclassical model, this is a stark demonstration of th ...
Open-Economy Macroeconomics: Basic Concepts
... different price levels in those countries. Foreign price Nominal exchange rate = Domestic price © 2007 Thomson South-Western ...
... different price levels in those countries. Foreign price Nominal exchange rate = Domestic price © 2007 Thomson South-Western ...
Problem Set 3 – Some Answers FE405
... higher interest rates 1) encourage people to borrow from non-bank financial intermediaries and 2) increase their deposits (this effect is reinforced if the deposit accounts pay interest). The reserve asset ratio may be a decreasing function of interest rates if banks hold excess reserves so that the ...
... higher interest rates 1) encourage people to borrow from non-bank financial intermediaries and 2) increase their deposits (this effect is reinforced if the deposit accounts pay interest). The reserve asset ratio may be a decreasing function of interest rates if banks hold excess reserves so that the ...
Foreign-exchange reserves
.PNG?width=300)
Foreign-exchange reserves (also called forex reserves or FX reserves) are assets held by a central bank or other monetary authority, usually in various reserve currencies, mostly the United States dollar, and to a lesser extent the euro, the pound sterling, and the Japanese yen, and used to back its liabilities—e.g., the local currency issued, and the various bank reserves deposited with the central bank by the government or by financial institutions.