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Global Imbalances and the Financial Crisis
... some countries are putting in place show worrisome tendencies and some policy changes are being ignored. This Council Special Report does not pretend that tackling imbalances is easy. Moreover, it does not suggest any major overhaul of the world’s financial system because, despite its faults, the cu ...
... some countries are putting in place show worrisome tendencies and some policy changes are being ignored. This Council Special Report does not pretend that tackling imbalances is easy. Moreover, it does not suggest any major overhaul of the world’s financial system because, despite its faults, the cu ...
In Focus: Markets as we see them China`s capital flight
... guidance at the most general level, something that has already been lost in translation in related private sector research reports. Furthermore, the estimates were based on past data that includes small/medium sized economies running large current account deficits, hardly an appropriate comparison t ...
... guidance at the most general level, something that has already been lost in translation in related private sector research reports. Furthermore, the estimates were based on past data that includes small/medium sized economies running large current account deficits, hardly an appropriate comparison t ...
Time Consistency of Monetary Policy in Separating Exchange Markets
... investigate the role of credibility in such a regime. It concludes that, for successfully separating exchange markets, government should fix the commercial exchange rate rather than change it. ...
... investigate the role of credibility in such a regime. It concludes that, for successfully separating exchange markets, government should fix the commercial exchange rate rather than change it. ...
Output and the Exchange Rate in the Short Run
... Assume a 75% depreciation of a country’s currency in one week Demand for foreign exchange has increased and supply has decreased Exchange rate goes from XRe to XR’’ Could have been capital flight out of country due to domestic crisis or due to exchange rate being fixed at inappropriate level for lon ...
... Assume a 75% depreciation of a country’s currency in one week Demand for foreign exchange has increased and supply has decreased Exchange rate goes from XRe to XR’’ Could have been capital flight out of country due to domestic crisis or due to exchange rate being fixed at inappropriate level for lon ...
The Monetary Transmission Mechanism: Some Answers and Further
... premium borrowers must pay for external finance, which in turn will reduce consumption and investment. Thus, the impact of policy-induced changes in interest rates may be magnified through this “financial accelerator” effect. Like the broad credit channel, the narrow credit or bank lending channel r ...
... premium borrowers must pay for external finance, which in turn will reduce consumption and investment. Thus, the impact of policy-induced changes in interest rates may be magnified through this “financial accelerator” effect. Like the broad credit channel, the narrow credit or bank lending channel r ...
Some thoughts on the Inflation Outlook and Monetary Policy
... been surprised by the strength of net immigration and its positive impact on productive capacity. There have also been question marks over the robustness of past empirical relationships, and the effectiveness of traditional monetary policy instruments, in an environment of unprecedented monetary acc ...
... been surprised by the strength of net immigration and its positive impact on productive capacity. There have also been question marks over the robustness of past empirical relationships, and the effectiveness of traditional monetary policy instruments, in an environment of unprecedented monetary acc ...
The BB-NN Model
... We have defined the real exchange rate “appreciated” when the economy is located below its external equilibrium. Is this good or bad? In principle, the workers are receiving a dollar wage that is higher than what they would receive in equilibrium. On the other hand, this situation is unsustainable a ...
... We have defined the real exchange rate “appreciated” when the economy is located below its external equilibrium. Is this good or bad? In principle, the workers are receiving a dollar wage that is higher than what they would receive in equilibrium. On the other hand, this situation is unsustainable a ...
The Fiscal and Monetary History of Colombia: 1963-2012 1 Introduction
... Figure 6 shows the evolution of debt in constant US dollars. Three things are worth noticing: First, since around 1970 foreign debt was greater than domestic debt, up until the 1990’s. At that point domestic debt surpassed foreign debt. This point marks the launch of the market for bonds issued by t ...
... Figure 6 shows the evolution of debt in constant US dollars. Three things are worth noticing: First, since around 1970 foreign debt was greater than domestic debt, up until the 1990’s. At that point domestic debt surpassed foreign debt. This point marks the launch of the market for bonds issued by t ...
PDF
... same time a decrease in demand for all non- US $ countries. In this study, we assume that the terms-of-trade effects are completely offsetting in the worldwide marked for industrial wood, and hence that aggregate dollar demand for timber is unaffected by our assumptions on exchange rates. This simpl ...
... same time a decrease in demand for all non- US $ countries. In this study, we assume that the terms-of-trade effects are completely offsetting in the worldwide marked for industrial wood, and hence that aggregate dollar demand for timber is unaffected by our assumptions on exchange rates. This simpl ...
Extending the Reserve Bank’s macroeconomic balance model of the exchange rate
... particular sustainable current account balance. This note updates the model to incorporate some uncertainty about the medium-term values of some of these parameters. This results in ranges within which the overall trade balance elasticity and desired current account balance may fall, and thus allows ...
... particular sustainable current account balance. This note updates the model to incorporate some uncertainty about the medium-term values of some of these parameters. This results in ranges within which the overall trade balance elasticity and desired current account balance may fall, and thus allows ...
Responding to the Monetary Superpower
... number of other central banks also lowered interest rates during this period. An important question, then, is what role the Federal Reserve played in influencing other central banks to alter their own monetary policies, which could have magnified the Fed’s actions in creating global liquidity. This ...
... number of other central banks also lowered interest rates during this period. An important question, then, is what role the Federal Reserve played in influencing other central banks to alter their own monetary policies, which could have magnified the Fed’s actions in creating global liquidity. This ...
Why may large economies suffer more at the zero lower bound?
... At the ZLB bad shocks are amplified and good shocks dampened. I show that this modifications are much stronger in the large than in the small economy. As a result the large economy may suffer more at the ZLB. ...
... At the ZLB bad shocks are amplified and good shocks dampened. I show that this modifications are much stronger in the large than in the small economy. As a result the large economy may suffer more at the ZLB. ...
Open economy models of distribution and growth
... integrated in the past few decades as a result of trade liberalisation, financial deregulation and technological change (especially in transportation and communication). In addition, this chapter briefly summarizes empirical tests of post-Keynesian macro models, most of which have emphasised differe ...
... integrated in the past few decades as a result of trade liberalisation, financial deregulation and technological change (especially in transportation and communication). In addition, this chapter briefly summarizes empirical tests of post-Keynesian macro models, most of which have emphasised differe ...
A SIMULTANEOUS-EQUATION MODEL OF SHORT
... There have been several recent studies examining the determinants of exchange rates for Pakistan or related countries. Zakaria et al. (2007) examine the PKR exchange rate versus 12 major trading partners. They indicate that exchange rates are influenced by relative inflation rates, monetary policies ...
... There have been several recent studies examining the determinants of exchange rates for Pakistan or related countries. Zakaria et al. (2007) examine the PKR exchange rate versus 12 major trading partners. They indicate that exchange rates are influenced by relative inflation rates, monetary policies ...
1 Economic Fundamentals on Exchange Rates under Different
... in international trade. Most of the exchange rate determination analysis mentioned so far focused on the developed countries’ major currencies. There are, of course, reasons for this. Exchange rates of the major currencies are mostly freely determined by the market after the 1973 Bretton Woods accor ...
... in international trade. Most of the exchange rate determination analysis mentioned so far focused on the developed countries’ major currencies. There are, of course, reasons for this. Exchange rates of the major currencies are mostly freely determined by the market after the 1973 Bretton Woods accor ...
What are the causes of financial crisis?
... On the capital account side, a slowing growth rate generally causes problems for a nation's debtors who have borrowed to finance production facilities or have invested in real estate or equities and are faced with repayment schedules. Lower growth means lower demand, possible lower profits, and a le ...
... On the capital account side, a slowing growth rate generally causes problems for a nation's debtors who have borrowed to finance production facilities or have invested in real estate or equities and are faced with repayment schedules. Lower growth means lower demand, possible lower profits, and a le ...
Macro2
... country with that in another. – Two special problems arise in making these comparisons. – Real GDP of one country must be converted into the same currency units as the real GDP of the other country, so an exchange rate must be used. – The same prices should be used to value the goods and services in ...
... country with that in another. – Two special problems arise in making these comparisons. – Real GDP of one country must be converted into the same currency units as the real GDP of the other country, so an exchange rate must be used. – The same prices should be used to value the goods and services in ...
Global Imbalances: In Midstream?
... Our purpose in this paper is twofold. First, we aim at clarifying the issues, laying down the facts, interpreting past and current imbalances, and forecasting their future evolution. Second, we argue that there are good reasons to want to reduce imbalances further. As a result of the crisis, there h ...
... Our purpose in this paper is twofold. First, we aim at clarifying the issues, laying down the facts, interpreting past and current imbalances, and forecasting their future evolution. Second, we argue that there are good reasons to want to reduce imbalances further. As a result of the crisis, there h ...
Explaining the Differences between Local Currency versus FX
... the one hand, they could rely on cheap FX funding from their parents abroad, whereas attracting deposits as a source of lending promised to be a longer and more involved process. On the other hand, extending FX loans shielded foreign banks from the exchange rate risk of dealing with often volatile d ...
... the one hand, they could rely on cheap FX funding from their parents abroad, whereas attracting deposits as a source of lending promised to be a longer and more involved process. On the other hand, extending FX loans shielded foreign banks from the exchange rate risk of dealing with often volatile d ...
Newsletter 30/2013
... "The price elasticity of demand for condoms - A field experiment on supply-side barriers to condom use in rural Zambia" Over two decades of behavior change education in developing countries have increased knowledge about HIV/AIDS and other sexually transmitted infections in Sub-Saharan Africa. Never ...
... "The price elasticity of demand for condoms - A field experiment on supply-side barriers to condom use in rural Zambia" Over two decades of behavior change education in developing countries have increased knowledge about HIV/AIDS and other sexually transmitted infections in Sub-Saharan Africa. Never ...
Colombian Purchasing Power Parity Analysed Using a Framework
... to regain control over monetary variables, after a period of very low real interest rates in combination with very large capital inflows. The exchange rate was allowed to fluctuate around a pre-determined central rate, which initially was to be continuously devalued at an annual rate of 11 percent. ...
... to regain control over monetary variables, after a period of very low real interest rates in combination with very large capital inflows. The exchange rate was allowed to fluctuate around a pre-determined central rate, which initially was to be continuously devalued at an annual rate of 11 percent. ...
Macroprudential policies, the long
... microeconomic focus, usually to deal with a market failure in a specific market that an individual bank or other financial firm will not, on its own, address. The simplifying assumption of partial equilibrium analysis is that such policies leave the economy-wide interest rate unchanged. They can rai ...
... microeconomic focus, usually to deal with a market failure in a specific market that an individual bank or other financial firm will not, on its own, address. The simplifying assumption of partial equilibrium analysis is that such policies leave the economy-wide interest rate unchanged. They can rai ...
Financial Cycle, Financial Stability and Monetary Policy
... • inflation measured in terms of consumer prices has not always signalled that imbalances in the economy have been building up. • prevailing monetary policy models used to forecast inflation pressures derive demand pressures from current inflation pressures. ...
... • inflation measured in terms of consumer prices has not always signalled that imbalances in the economy have been building up. • prevailing monetary policy models used to forecast inflation pressures derive demand pressures from current inflation pressures. ...
Foreign-exchange reserves
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.