Exchange Rate Policies in Arab Countries
... economy. Changes can cause substantial reallocation of resources and production between the tradeable and non-tradeable sectors of the economy. But rarely is the exchange rate seen for what it is: a relative price that, like any other, responds to the laws of supply and demand. Being a price, the ex ...
... economy. Changes can cause substantial reallocation of resources and production between the tradeable and non-tradeable sectors of the economy. But rarely is the exchange rate seen for what it is: a relative price that, like any other, responds to the laws of supply and demand. Being a price, the ex ...
Interest Rates and the Exchange Rate: A Non
... the positive effect coming from deposits becomes gradually smaller. This implies that as long as deposit demand is more elastic than cash demand for low domestic interest rates, initially money demand will rise with the interest rate since the demand deposit effect dominates. However, beyond a certai ...
... the positive effect coming from deposits becomes gradually smaller. This implies that as long as deposit demand is more elastic than cash demand for low domestic interest rates, initially money demand will rise with the interest rate since the demand deposit effect dominates. However, beyond a certai ...
mmi13 Benassy-Quere new 19076037 en
... the Euro area in 2008 and following years was a sudden stop of private capital inflows, which had to be taken over by official financings (Member states, European Financial Stability Facility, International Monetary Fund), and by the intra-Euro area payment system (TARGET2).1 Indeed, crisis countrie ...
... the Euro area in 2008 and following years was a sudden stop of private capital inflows, which had to be taken over by official financings (Member states, European Financial Stability Facility, International Monetary Fund), and by the intra-Euro area payment system (TARGET2).1 Indeed, crisis countrie ...
Full article text
... by Merton who characterized the self-fulfilling prophecy as an initially incorrect definition of a situation triggering new actions which then verify the initial false conception. In a recent questionnaire survey of foreign exchange professionals in Germany, Menkhoff argues that chartism may be seen ...
... by Merton who characterized the self-fulfilling prophecy as an initially incorrect definition of a situation triggering new actions which then verify the initial false conception. In a recent questionnaire survey of foreign exchange professionals in Germany, Menkhoff argues that chartism may be seen ...
The Importance of Composition of Fiscal Policy: Evidence from
... the main points we wish to emphasize. In the presence of full price rigidity, supply-side factors are unimportant in the short-run since it is assumed that the level of demand determines output. In that environment, fiscal policy (government spending or taxation) only operates via an aggregate deman ...
... the main points we wish to emphasize. In the presence of full price rigidity, supply-side factors are unimportant in the short-run since it is assumed that the level of demand determines output. In that environment, fiscal policy (government spending or taxation) only operates via an aggregate deman ...
This PDF is a selection from an out-of-print volume from... of Economic Research
... any tax on capital imports, to the expected rated of depreciation of the domestic currency. The country is small in the world financial markets and r* is ...
... any tax on capital imports, to the expected rated of depreciation of the domestic currency. The country is small in the world financial markets and r* is ...
MEASURING EXCHANGE MARKET PRESSURE IN MONGOLIA
... needed to examine and implement is to determine exchange market pressure with numerical values and to review opportunity to use it in exchange rate policy. In international experience, pressure on domestic currency is expressed by “exchange market pressure (hereinafter “EMP”) index”. Griton&Roper (1 ...
... needed to examine and implement is to determine exchange market pressure with numerical values and to review opportunity to use it in exchange rate policy. In international experience, pressure on domestic currency is expressed by “exchange market pressure (hereinafter “EMP”) index”. Griton&Roper (1 ...
"Exchange Rate Disconnect in General Equilibrium"
... We start with a flexible modeling framework that can nest most standard international macro models, which allows us in what follows to consider various special cases and extensions. There are two countries, home (Europe) and foreign (US, denoted with a ∗). Each country has a nominal unit of account, ...
... We start with a flexible modeling framework that can nest most standard international macro models, which allows us in what follows to consider various special cases and extensions. There are two countries, home (Europe) and foreign (US, denoted with a ∗). Each country has a nominal unit of account, ...
DP2004/07 A model of Equilibrium Exchange Rates for the New Zealand
... In Wren-Lewis (2003) I outlined four major methods of calculating an equilibrium exchange rate (EER): direct PPP calculations, regression based methods, partial equilibrium analysis and full model calculations. The analysis presented here falls into the third category. In a nutshell, we assume some ...
... In Wren-Lewis (2003) I outlined four major methods of calculating an equilibrium exchange rate (EER): direct PPP calculations, regression based methods, partial equilibrium analysis and full model calculations. The analysis presented here falls into the third category. In a nutshell, we assume some ...
A New Currency of the Future: The Novel Commodity Money with
... Although the commodity money has an advantage of stable intrinsic value, it has an obvious drawback of high logistics cost. In comparison, the logistics cost of metal currency is lower. To further reduce the logistics cost of commodity money, there was a time when people used precious metal as a maj ...
... Although the commodity money has an advantage of stable intrinsic value, it has an obvious drawback of high logistics cost. In comparison, the logistics cost of metal currency is lower. To further reduce the logistics cost of commodity money, there was a time when people used precious metal as a maj ...
Chapter 18
... The Equality of NX and NCO § An accounting identity: NCO = NX § Imbalances in the net capital outflow (NCO) are associated with imbalances in the trade balance (or net exports, NX), following the identity NCO = NX. § Each exchange that affects the net capital outflow, also affects net exports in ...
... The Equality of NX and NCO § An accounting identity: NCO = NX § Imbalances in the net capital outflow (NCO) are associated with imbalances in the trade balance (or net exports, NX), following the identity NCO = NX. § Each exchange that affects the net capital outflow, also affects net exports in ...
The Price Puzzle in Emerging Markets:
... Imbalances arising from public budget limitations, namely budget deficit and its financing method, put direct and, through expectations, indirect pressure on the economy, which accumulated through the end of 1990s. Following 1998 Russian crisis and the devastating 1999 earthquake, Turkish economy e ...
... Imbalances arising from public budget limitations, namely budget deficit and its financing method, put direct and, through expectations, indirect pressure on the economy, which accumulated through the end of 1990s. Following 1998 Russian crisis and the devastating 1999 earthquake, Turkish economy e ...
EXCHANGE RATE AND INFLATION: A CASE OF
... policy decisions are at stake. This is so because higher inflation volatility means higher uncertainty, affecting inflation expectations, a crucial variable in decisions under an inflation-targeting regime. It is possible to classify the literature in two groups: those authors to whom there is no c ...
... policy decisions are at stake. This is so because higher inflation volatility means higher uncertainty, affecting inflation expectations, a crucial variable in decisions under an inflation-targeting regime. It is possible to classify the literature in two groups: those authors to whom there is no c ...
Price Levels and the Exchange Rate in the Long Run
... PPP, which states that the percentage change in the exchange rate between two currencies over any period equals the difference between the percentage changes in national price levels. Relative PPP thus translates absolute PPP from a statement about price and exchange rate levels into one about price ...
... PPP, which states that the percentage change in the exchange rate between two currencies over any period equals the difference between the percentage changes in national price levels. Relative PPP thus translates absolute PPP from a statement about price and exchange rate levels into one about price ...
The Contribution of Economic Fundamentals to Movements in
... future fundamentals but these expectations are not directly observable. The state-space model offers a convenient framework in which we can model the expectations as latent factors and allow them to have flexible dynamics. In doing this, we can extract agent’s expectations using the Kalman filter an ...
... future fundamentals but these expectations are not directly observable. The state-space model offers a convenient framework in which we can model the expectations as latent factors and allow them to have flexible dynamics. In doing this, we can extract agent’s expectations using the Kalman filter an ...
NEER WORKING PAPER SERIES COMMODITY EXPORT PRICES AND THE REAL
... valuation and inflation. In practice there has been an inverse relationship between the rate of devaluation of the peg and coffee prices. This relation can be seen in Table 2. The high coffee prices of 1976—79, for example, were accompanied by a significant slow—down of the rate of devaluation; when ...
... valuation and inflation. In practice there has been an inverse relationship between the rate of devaluation of the peg and coffee prices. This relation can be seen in Table 2. The high coffee prices of 1976—79, for example, were accompanied by a significant slow—down of the rate of devaluation; when ...
Some Further Evidence on Exchange
... investment or other transactions, rather than use the forward-exchange market, they can borrow and lend in local currency to offset their other commitments. For example, a plant in a foreign country can be financed mainly with local capital, so that investors limit their exchange risk in the basic i ...
... investment or other transactions, rather than use the forward-exchange market, they can borrow and lend in local currency to offset their other commitments. For example, a plant in a foreign country can be financed mainly with local capital, so that investors limit their exchange risk in the basic i ...
PDF Version - Federal Reserve Bank of Minneapolis
... What lies behind this rather abrupt reduction in the rate of inflation in Argentina over the last decade? In 1991, Argentine law created a currency board, which, in effect, relinquished control of Argentina's money supply to the United States. Under this institutional setting, Argentina's provincial ...
... What lies behind this rather abrupt reduction in the rate of inflation in Argentina over the last decade? In 1991, Argentine law created a currency board, which, in effect, relinquished control of Argentina's money supply to the United States. Under this institutional setting, Argentina's provincial ...
The Eurosystem`s bond purchases and the exchange rate of the
... competitiveness or exert a deflationary impulse. If the partner currency is pegged to the euro by a fixed exchange rate, the foreign central bank is bound – on institutional grounds alone – to undertake foreign exchange interventions in order to prevent an appreciation of its currency. Monetary ea ...
... competitiveness or exert a deflationary impulse. If the partner currency is pegged to the euro by a fixed exchange rate, the foreign central bank is bound – on institutional grounds alone – to undertake foreign exchange interventions in order to prevent an appreciation of its currency. Monetary ea ...
Working Paper Series Contagion and interdependence
... the impact of economic conditions in the United States on emerging markets. They conclude that economic downturns in the United States have adverse consequences on emerging markets, in particular for those whose export share to the United States is large. Moreover, capital flows to emerging markets ...
... the impact of economic conditions in the United States on emerging markets. They conclude that economic downturns in the United States have adverse consequences on emerging markets, in particular for those whose export share to the United States is large. Moreover, capital flows to emerging markets ...
Risk-Premia, Carry-Trade Dynamics, and Speculative
... We build on Lyons (2001) who argues that deviations of the Fama-regression β form its UIPtheoretic value may not be important in economic terms as long as deviations are too small to attract speculative capital. We extend his logic to the regression constant α and argue that for UIP in a speculative ...
... We build on Lyons (2001) who argues that deviations of the Fama-regression β form its UIPtheoretic value may not be important in economic terms as long as deviations are too small to attract speculative capital. We extend his logic to the regression constant α and argue that for UIP in a speculative ...
1 Exchange Rate Misalignment: An Overview
... and foreign goods that are not perfectly substitutable. For countries with a large share of standardized commodities in their exports, the applicability of cost-based RERs may, therefore, be limited. For such countries the relevant concept of competitiveness is not the ability to produce at lower co ...
... and foreign goods that are not perfectly substitutable. For countries with a large share of standardized commodities in their exports, the applicability of cost-based RERs may, therefore, be limited. For such countries the relevant concept of competitiveness is not the ability to produce at lower co ...
September 28 , 2007 Nelson H. Barbosa-Filho
... highest level in real terms since the debt crisis of the early 1980s. The Brazilian inflation rate followed soon after and reached double-digit levels at the end of 2002. In fact, the exchange-rate depreciation and inflation acceleration were so sharp and fast that they even made the Brazilian month ...
... highest level in real terms since the debt crisis of the early 1980s. The Brazilian inflation rate followed soon after and reached double-digit levels at the end of 2002. In fact, the exchange-rate depreciation and inflation acceleration were so sharp and fast that they even made the Brazilian month ...
Money, Interest Rates, and Exchange Rates
... • Money is very liquid: it can be easily and quickly used to pay for goods and services. • Money, however, pays little or no rate of return. • Suppose we can group assets into money (liquid assets) and all other assets (illiquid assets). ...
... • Money is very liquid: it can be easily and quickly used to pay for goods and services. • Money, however, pays little or no rate of return. • Suppose we can group assets into money (liquid assets) and all other assets (illiquid assets). ...
wiwi.uni-frankfurt.de
... • Foreclosure procedures introduced and foreign investment restrictions are reduced • High interest rates are reduced by mid-1998. • Non-performing loans remain on a high level. • Positive growth in late 1998 (GDP growth>4% in 1999) ...
... • Foreclosure procedures introduced and foreign investment restrictions are reduced • High interest rates are reduced by mid-1998. • Non-performing loans remain on a high level. • Positive growth in late 1998 (GDP growth>4% in 1999) ...