IOSR Journal of Economics and Finance (IOSR-JEF)
... This assumes that the higher costs of production arising from the devaluation, such as increased domestic prices for imported inputs, do not offset the rise in export revenues. So when an economy attempts to attain both internal and external balance, expenditure switching policy alone is insufficien ...
... This assumes that the higher costs of production arising from the devaluation, such as increased domestic prices for imported inputs, do not offset the rise in export revenues. So when an economy attempts to attain both internal and external balance, expenditure switching policy alone is insufficien ...
From Great Depression to Great Recession
... present post–Bretton Woods; and they are surely with us today—indeed amplified by the growth in private capital flows, and rising global interconnectedness. That is why I believe that analyzing current issues through the prism of history can be instructive. So what are the current issues with the in ...
... present post–Bretton Woods; and they are surely with us today—indeed amplified by the growth in private capital flows, and rising global interconnectedness. That is why I believe that analyzing current issues through the prism of history can be instructive. So what are the current issues with the in ...
The monetary policies of two countries having trade relations are not
... bank’s credibility problem vis-à-vis the private sector. Oudiz and Sachs (1985) distinguish between open-loop and closed-loop behaviour and between non-cooperative and cooperative decisions. However, the article does not consider the relevance of different shock scenarios. In addition, Canzoneri and ...
... bank’s credibility problem vis-à-vis the private sector. Oudiz and Sachs (1985) distinguish between open-loop and closed-loop behaviour and between non-cooperative and cooperative decisions. However, the article does not consider the relevance of different shock scenarios. In addition, Canzoneri and ...
Avoiding some costs of inflation and crawling toward hyperinflation
... consideration of the g o v e r n m e n t ' s objectives and budget constraint (both represented by the central b a n k ' s reaction function). The households' aggregate financial wealth in period 1, W~, is entirely deposited at the b a n k in the form of d e m a n d deposits, M 1, 4 and m o n e y ma ...
... consideration of the g o v e r n m e n t ' s objectives and budget constraint (both represented by the central b a n k ' s reaction function). The households' aggregate financial wealth in period 1, W~, is entirely deposited at the b a n k in the form of d e m a n d deposits, M 1, 4 and m o n e y ma ...
NBER WORKING PAPER SERIES A LONG RUN VIEW Michael D. Bordo
... vulnerable to shocks and lacks the capacity to make necessary quick adjustments, ‘ultracredible’ currency policies can change suddenly. Thus, forming monetary unions, as in Europe, was the remaining option. So far, relatively few countries in the world have taken the option to ‘dollarize’ or ‘euroiz ...
... vulnerable to shocks and lacks the capacity to make necessary quick adjustments, ‘ultracredible’ currency policies can change suddenly. Thus, forming monetary unions, as in Europe, was the remaining option. So far, relatively few countries in the world have taken the option to ‘dollarize’ or ‘euroiz ...
Currency Mismatch: New Database and Indicators for Latin America
... currency mismatch has been mistaken for other concepts related to financial risk, promoting the inappropriate use of original sin indicators (Eichengreen, Hausmann and Panizza, 2007) and several measures of external vulnerability (e.g., the ratio of broad money to international reserves) as proxies ...
... currency mismatch has been mistaken for other concepts related to financial risk, promoting the inappropriate use of original sin indicators (Eichengreen, Hausmann and Panizza, 2007) and several measures of external vulnerability (e.g., the ratio of broad money to international reserves) as proxies ...
NBER WORKING PAPER SEPJES EXPLAINING THE DURATION OF EXCHANGE-RATE PEGS Michael W. Klein
... devaluation, there is also strong evidence that snucwral factors matter. The more open the economy, the lower the likelihood of devaluation. The greater the degree of geographical trade concentration, the higher the likelihood of devaluation. Political events, such as regular and irregular executive ...
... devaluation, there is also strong evidence that snucwral factors matter. The more open the economy, the lower the likelihood of devaluation. The greater the degree of geographical trade concentration, the higher the likelihood of devaluation. Political events, such as regular and irregular executive ...
Exam Name___________________________________
... B) involve the exchange of bank deposits at some specified future date. C) involve the immediate exchange of imports and exports. D) none of the above. Answer: B 58) The foreign exchange market A) is organized as an over-the-counter market in which several hundred dealers stand ready to buy and sell ...
... B) involve the exchange of bank deposits at some specified future date. C) involve the immediate exchange of imports and exports. D) none of the above. Answer: B 58) The foreign exchange market A) is organized as an over-the-counter market in which several hundred dealers stand ready to buy and sell ...
DISCUSSION PAPERS THE MAKING OF THE TURKISH FINANCIAL CRISIS
... enjoying wide public confidence and support as well as gaining praise from IMF officials. However, it started running into problems in Autumn 2000, necessitating a relatively large IMF bailout to keep it on course. After a few months of muddling through it became clear that the program was not viabl ...
... enjoying wide public confidence and support as well as gaining praise from IMF officials. However, it started running into problems in Autumn 2000, necessitating a relatively large IMF bailout to keep it on course. After a few months of muddling through it became clear that the program was not viabl ...
Economic Premise - World Bank Group
... system requires the dominance of a single currency, namely the U.S. dollar. To a significant extent, U.S. dollar dominance is the result of specific policy choices by individual countries (for example, export-led growth strategies, close links to the U.S. dollar) rather than an inherent rigidity in ...
... system requires the dominance of a single currency, namely the U.S. dollar. To a significant extent, U.S. dollar dominance is the result of specific policy choices by individual countries (for example, export-led growth strategies, close links to the U.S. dollar) rather than an inherent rigidity in ...
Foreign Currency Transactions
... A Derivative Defined FASB 133 defines a derivative as a financial instrument or contract possessing all of the following characteristics: The financial instrument must contain one or more underlying, and one or more notional amounts. ...
... A Derivative Defined FASB 133 defines a derivative as a financial instrument or contract possessing all of the following characteristics: The financial instrument must contain one or more underlying, and one or more notional amounts. ...
An Empirical Study of a ‘Mystery of Currency Exposure’ with the Case of A-Share Listed Companies
... formation is a manageable floating exchange rate system, and the effects of market supply and demand changes on the RMB exchange rate are becoming evident. It is foreseeable that the importance of the accidental or unpredictable aspects of the RMB exchange rate will gradually increase. On the one ha ...
... formation is a manageable floating exchange rate system, and the effects of market supply and demand changes on the RMB exchange rate are becoming evident. It is foreseeable that the importance of the accidental or unpredictable aspects of the RMB exchange rate will gradually increase. On the one ha ...
Final Thoughts - The University of Chicago Booth School of Business
... and the dollar to depreciate. (The exact opposite happens if US GDP falls). An increase in the GDP of Japan, increases the supply of Yen. If the Japanese have a greater income, they would want to buy more U.S. goods. In order to buy more U.S. stuff, they need dollars. Their demand for dollars would ...
... and the dollar to depreciate. (The exact opposite happens if US GDP falls). An increase in the GDP of Japan, increases the supply of Yen. If the Japanese have a greater income, they would want to buy more U.S. goods. In order to buy more U.S. stuff, they need dollars. Their demand for dollars would ...
Why Trade Forex
... A standard account allows you to trade a contract size of 100,000 units, 10 times the amount offered in a mini account. Mini Account The mini account allows you to trade in smaller contract sizes of 10,000 units which is 1/10th the size of the standard account. The mini account allows traders to bec ...
... A standard account allows you to trade a contract size of 100,000 units, 10 times the amount offered in a mini account. Mini Account The mini account allows you to trade in smaller contract sizes of 10,000 units which is 1/10th the size of the standard account. The mini account allows traders to bec ...
Bretton Woods system - Wikipedia, the free encyclopedia
... The experience of the Great Depression was fresh on the minds of public officials. The planners at Bretton Woods hoped to avoid a repeat of the debacle of the 1930s, when intransigent American insistence as a creditor nation on the repayment of Allied war debts, combined with an inclination to isola ...
... The experience of the Great Depression was fresh on the minds of public officials. The planners at Bretton Woods hoped to avoid a repeat of the debacle of the 1930s, when intransigent American insistence as a creditor nation on the repayment of Allied war debts, combined with an inclination to isola ...
22-30 Latin American Financial Crises (cont.)
... • A banking crisis may result from a debt crisis. – High default rates on loans made by banks reduce their income to pay for liabilities and may increase bankruptcy. – If depositors fear bankruptcy due to possible devaluation of the currency or default on government debt (assets for banks), then the ...
... • A banking crisis may result from a debt crisis. – High default rates on loans made by banks reduce their income to pay for liabilities and may increase bankruptcy. – If depositors fear bankruptcy due to possible devaluation of the currency or default on government debt (assets for banks), then the ...
This PDF is a selection from an out-of-print volume from... of Economic Research
... The emphasis on liquidity and the adjustment of liquid asset stocks should not obscure the basic point that, in an ideal world, the purpose of all international trade, whether in goods and services, in assets, or over time (i.e., in dated goods and services), is to exploit the potential gains afford ...
... The emphasis on liquidity and the adjustment of liquid asset stocks should not obscure the basic point that, in an ideal world, the purpose of all international trade, whether in goods and services, in assets, or over time (i.e., in dated goods and services), is to exploit the potential gains afford ...
Section 5
... • These changes include a rise in investment, a rise in government expenditures, and a reduction of taxes. • They also include an increase in home prices or a reduction in foreign prices that raise the real exchange rate for a given level of the nominal exchange rate. ...
... • These changes include a rise in investment, a rise in government expenditures, and a reduction of taxes. • They also include an increase in home prices or a reduction in foreign prices that raise the real exchange rate for a given level of the nominal exchange rate. ...
IV. Monetary policy and the exchange rate in a very small, open and
... Since adopting its inflation target in March 2001, Iceland has experienced a recession and a boom while inflation has on average been considerably above the target of 2.5% and highly variable. The average 12-month rate of increase in the CPI has been 4.7%. Although the record is somewhat better if c ...
... Since adopting its inflation target in March 2001, Iceland has experienced a recession and a boom while inflation has on average been considerably above the target of 2.5% and highly variable. The average 12-month rate of increase in the CPI has been 4.7%. Although the record is somewhat better if c ...
The euro crisis and its future
... countries, particularly of the peripheral ones. 3. - The reasons of the euro crisis. The peripheral countries of the euro area have suffered a growing fragility because of the increase of the debt of its private sector abroad. The crisis is related mainly with the external deficits and the public de ...
... countries, particularly of the peripheral ones. 3. - The reasons of the euro crisis. The peripheral countries of the euro area have suffered a growing fragility because of the increase of the debt of its private sector abroad. The crisis is related mainly with the external deficits and the public de ...
MS Word - of Planning Commission
... normal exchange rates requires that the major trading countries accept the fixed nominal exchange rates as parametric, and adjust their domestic economic policies to ensure external account viability at these rates. This requires a substantial sacrifice of domestic policy objectives to the requireme ...
... normal exchange rates requires that the major trading countries accept the fixed nominal exchange rates as parametric, and adjust their domestic economic policies to ensure external account viability at these rates. This requires a substantial sacrifice of domestic policy objectives to the requireme ...
Modern Money Theory 101: A Reply to Critics
... always solvent, and can afford to buy anything for sale in their domestic unit of account even though they may face inflationary and political constraints.3 MMT has also provided policy insights with respect to financial stability, price stability and full employment. It argues these are important g ...
... always solvent, and can afford to buy anything for sale in their domestic unit of account even though they may face inflationary and political constraints.3 MMT has also provided policy insights with respect to financial stability, price stability and full employment. It argues these are important g ...
Currency war
Currency war, also known as competitive devaluation, is a condition in international affairs where countries compete against each other to achieve a relatively low exchange rate for their own currency. As the price to buy a country's currency falls so too does the price of exports. Imports to the country become more expensive. So domestic industry, and thus employment, receives a boost in demand from both domestic and foreign markets. However, the price increase for imports can harm citizens' purchasing power. The policy can also trigger retaliatory action by other countries which in turn can lead to a general decline in international trade, harming all countries.Competitive devaluation has been rare through most of history as countries have generally preferred to maintain a high value for their currency. Countries have generally allowed market forces to work, or have participated in systems of managed exchanges rates. An exception occurred when currency war broke out in the 1930s. As countries abandoned the Gold Standard during the Great Depression, they used currency devaluations to stimulate their economies. Since this effectively pushes unemployment overseas, trading partners quickly retaliated with their own devaluations. The period is considered to have been an adverse situation for all concerned, as unpredictable changes in exchange rates reduced overall international trade.According to Guido Mantega, the Brazilian Minister for Finance, a global currency war broke out in 2010. This view was echoed by numerous other government officials and financial journalists from around the world. Other senior policy makers and journalists suggested the phrase ""currency war"" overstated the extent of hostility. With a few exceptions, such as Mantega, even commentators who agreed there had been a currency war in 2010 generally concluded that it had fizzled out by mid-2011.States engaging in possible competitive devaluation since 2010 have used a mix of policy tools, including direct government intervention, the imposition of capital controls, and, indirectly, quantitative easing. While many countries experienced undesirable upward pressure on their exchange rates and took part in the ongoing arguments, the most notable dimension of the 2010–11 episode was the rhetorical conflict between the United States and China over the valuation of the yuan. In January 2013, measures announced by Japan which were expected to devalue its currency sparked concern of a possible second 21st century currency war breaking out, this time with the principal source of tension being not China versus the US, but Japan versus the Eurozone. By late February, concerns of a new outbreak of currency war had been mostly allayed, after the G7 and G20 issued statements committing to avoid competitive devaluation. After the European Central Bank launched a fresh programme of quantitative easing in January 2015, there was once again an intensification of discussion about currency war.