NBER WORKING PAPER SERIES CAPITAL CONTROLS, THE DUAL EXCHANGE RATE, AND Maurice Obstfeld
... —4-foreign—currency price of the consumption good, P, and the world real bond price, q*, are exogenous, and assumed fixed. In the model of this section, there are no official restrictions on international capital move- ...
... —4-foreign—currency price of the consumption good, P, and the world real bond price, q*, are exogenous, and assumed fixed. In the model of this section, there are no official restrictions on international capital move- ...
Regional Currency Arrangements in North America
... Considerations based on McKinnon (1963) suggest that very open economies make better candidates for currency union, especially if they are major trading partners. As the subsequent debate has pointed out, whether trade raises or reduces asymmetries among countries depends at least in part on whether ...
... Considerations based on McKinnon (1963) suggest that very open economies make better candidates for currency union, especially if they are major trading partners. As the subsequent debate has pointed out, whether trade raises or reduces asymmetries among countries depends at least in part on whether ...
Partial Keys to Question Set 2
... investment through the falling interest rate. The consequence on FOREX rate is that the falling interest rate will cause Capital Outflows; Demand for FOREX in Japan; and thus Immediate Appreciation of FOREX (or immediate depreciation of Japanese Yen). This is from the viewpoint of International Inve ...
... investment through the falling interest rate. The consequence on FOREX rate is that the falling interest rate will cause Capital Outflows; Demand for FOREX in Japan; and thus Immediate Appreciation of FOREX (or immediate depreciation of Japanese Yen). This is from the viewpoint of International Inve ...
Chapter 13: Foreign Currency Financial Statements
... Publishing as Prentice Hall © Pearson Education, Inc. publishing as Prentice Hall ...
... Publishing as Prentice Hall © Pearson Education, Inc. publishing as Prentice Hall ...
eiteman_ppt_ch02
... – The lack of confidence forced President Richard Nixon to suspend official purchases or sales of gold by the US Treasury on August 15, 1971 – This resulted in subsequent devaluations of the dollar – Most currencies were allowed to float to levels determined by market forces as of March, 1973 ...
... – The lack of confidence forced President Richard Nixon to suspend official purchases or sales of gold by the US Treasury on August 15, 1971 – This resulted in subsequent devaluations of the dollar – Most currencies were allowed to float to levels determined by market forces as of March, 1973 ...
Exchange Rates, Business Cycles, and Macroeconomic Policy in
... ¾ Any factor that changes net exports (for a given domestic output and the domestic real interest rate) also shifts the open-economy IS curve and in the same direction. ...
... ¾ Any factor that changes net exports (for a given domestic output and the domestic real interest rate) also shifts the open-economy IS curve and in the same direction. ...
Introduction to International Business
... effects; Balance-of-payment effects; Effect on competition and economic growth ◦ Adverse effect on competition; adverse effects on the balance of payments; national sovereignty and autonomy ◦ Benefits: inward cash flow; employment effects; skills learned from abroad ◦ Costs: balance of payments; emp ...
... effects; Balance-of-payment effects; Effect on competition and economic growth ◦ Adverse effect on competition; adverse effects on the balance of payments; national sovereignty and autonomy ◦ Benefits: inward cash flow; employment effects; skills learned from abroad ◦ Costs: balance of payments; emp ...
chapter 16 exchange-rate systems
... 19. Under a floating exchange rate system, an increase in U.S. imports of Japanese goods will cause the demand schedule for Japanese yen to: a. Increase, inducing a depreciation in the yen b. Decrease, inducing a depreciation in the yen c. Increase, inducing an appreciation in the yen d. Decrease, i ...
... 19. Under a floating exchange rate system, an increase in U.S. imports of Japanese goods will cause the demand schedule for Japanese yen to: a. Increase, inducing a depreciation in the yen b. Decrease, inducing a depreciation in the yen c. Increase, inducing an appreciation in the yen d. Decrease, i ...
The Price of Gold and the Exchange Rates
... The main objective of this paper, as in a previous one, is to identify the effect of major currency exchange rates on the prices of internationally traded commodities.1 For commodities that are traded continuously in organized markets such as the Chicago Board of Trade, a change in any exchange rat ...
... The main objective of this paper, as in a previous one, is to identify the effect of major currency exchange rates on the prices of internationally traded commodities.1 For commodities that are traded continuously in organized markets such as the Chicago Board of Trade, a change in any exchange rat ...
Hard peg and monetary unions.Main lessons from the Argentine
... From the fiscal point of view, a CB has a strong advantage, especially in terms of fiscal financing transparency. The only way of financing deficits is with debt, thus the real measurement of fiscal deficit is the growth of the country’s debt (see Figure 1). Convertibility started with a public deb ...
... From the fiscal point of view, a CB has a strong advantage, especially in terms of fiscal financing transparency. The only way of financing deficits is with debt, thus the real measurement of fiscal deficit is the growth of the country’s debt (see Figure 1). Convertibility started with a public deb ...
A generation of an internationalised Australian dollar
... Exchange rate volatility has been considerably higher in the post-float period, although, of course, the large discrete changes in the exchange rate which occurred in the fixed rate regimes, reflecting the occasional large realignments, no longer occur (Figure 2). Arguably, market participants found ...
... Exchange rate volatility has been considerably higher in the post-float period, although, of course, the large discrete changes in the exchange rate which occurred in the fixed rate regimes, reflecting the occasional large realignments, no longer occur (Figure 2). Arguably, market participants found ...
internal balance
... the number of dollars they get for a pound note is much below the mint parity at 4.856 Assume the SER is 4.787 US$ per £ 1. Buy 1 ounce of gold in London at the official price and ship it to New York at the cost of 0.12 US$. Present the gold in NY and you will receive 20.646 US$ but you have to dedu ...
... the number of dollars they get for a pound note is much below the mint parity at 4.856 Assume the SER is 4.787 US$ per £ 1. Buy 1 ounce of gold in London at the official price and ship it to New York at the cost of 0.12 US$. Present the gold in NY and you will receive 20.646 US$ but you have to dedu ...
Statutory Issue Paper No. 81 Foreign Currency Transactions and
... property and casualty insurers provides that fluctuations in the value of assets and liabilities be summarized and recorded as a net asset or liability with an offsetting adjustment made directly to surplus. Current statutory guidance for life and accident and health insurers provides that fluctuati ...
... property and casualty insurers provides that fluctuations in the value of assets and liabilities be summarized and recorded as a net asset or liability with an offsetting adjustment made directly to surplus. Current statutory guidance for life and accident and health insurers provides that fluctuati ...
Changing views on how best to conduct monetary
... There are many aspects to this, but perhaps the most crucial is the empirical framework. All monetary policy decisions must be based on some idea of how decisions will affect the real world. In short, policymakers must conduct their policy within the framework of a model. This is not a statement tha ...
... There are many aspects to this, but perhaps the most crucial is the empirical framework. All monetary policy decisions must be based on some idea of how decisions will affect the real world. In short, policymakers must conduct their policy within the framework of a model. This is not a statement tha ...
Currency Boards vs. Dollarization: Lessons from the Cook Islands
... economic disruption. For example, the Republic of Ireland continued to enjoy almost identical price trends to those of the United Kingdom over the 1928–79 period—with the one-to-one exchange rate between the Irish pound and the pound sterling maintained throughout—even after the monetary authority’s ...
... economic disruption. For example, the Republic of Ireland continued to enjoy almost identical price trends to those of the United Kingdom over the 1928–79 period—with the one-to-one exchange rate between the Irish pound and the pound sterling maintained throughout—even after the monetary authority’s ...
Measuring world growth: do weights matter?
... world, with the weights reflecting the relative importance of each region in the world economy (i.e. its share in the total value of world GDP). In order to compute this share, national data, initially expressed in the national currency, are converted into a common currency using an exchange rate me ...
... world, with the weights reflecting the relative importance of each region in the world economy (i.e. its share in the total value of world GDP). In order to compute this share, national data, initially expressed in the national currency, are converted into a common currency using an exchange rate me ...
The influences of monetary policy
... What is open market operation? Open market operations are the means of implementing monetary policy by which a central bank controls its national money supply by buying and selling government securities, or other financial instruments. Monetary targets, such as interest rates or exchange rates, ar ...
... What is open market operation? Open market operations are the means of implementing monetary policy by which a central bank controls its national money supply by buying and selling government securities, or other financial instruments. Monetary targets, such as interest rates or exchange rates, ar ...
Exam I - UTSA.edu
... the value of the Swiss franc with respect to the U.S. dollar will generally appreciate the value of the Swiss franc with respect to the U.S. dollar will generally depreciate the value of the Swiss franc with respect to the U.S. dollar would generally remain constant The value of the Swiss franc with ...
... the value of the Swiss franc with respect to the U.S. dollar will generally appreciate the value of the Swiss franc with respect to the U.S. dollar will generally depreciate the value of the Swiss franc with respect to the U.S. dollar would generally remain constant The value of the Swiss franc with ...
Currency crises and monetary policy in an economy with credit
... features observed in recent crises and left unexplained by the previous literature. For example, countries with less developed )nancial systems are more likely to experience an output decline during a crisis. 7 Second, a currency crisis can also happen under a 5exible exchange rate or without any si ...
... features observed in recent crises and left unexplained by the previous literature. For example, countries with less developed )nancial systems are more likely to experience an output decline during a crisis. 7 Second, a currency crisis can also happen under a 5exible exchange rate or without any si ...
Weak dollar, strong euro? - Centre for European Reform
... consolidation should take place in European representation in the IMF and the other multilateral financial institutions. This paper will attempt to analyse the implications of EMU for the world economy. Section II provides a brief discussion of the state of the international debate of these issues. S ...
... consolidation should take place in European representation in the IMF and the other multilateral financial institutions. This paper will attempt to analyse the implications of EMU for the world economy. Section II provides a brief discussion of the state of the international debate of these issues. S ...
Chapter 16
... – Inflation bias: Government may try to take advantage of sticky prices by pursuing expansionary monetary policy. But if the public anticipates this strategy, it will bargain for higher wages, causing higher prices and no output gain. – It may be difficult to trace the source of shocks to either out ...
... – Inflation bias: Government may try to take advantage of sticky prices by pursuing expansionary monetary policy. But if the public anticipates this strategy, it will bargain for higher wages, causing higher prices and no output gain. – It may be difficult to trace the source of shocks to either out ...
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.