The Curious Case of the Yen as a Safe Haven Currency
... investors’ behavior becomes more risk-averse or economic fundamentals are more uncertain. 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 ex ...
... investors’ behavior becomes more risk-averse or economic fundamentals are more uncertain. 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 ex ...
Exchange Rates and Purchasing Power Parity
... PPP Model as Special Case Real exchange rate equation captures reality at any point in time PPP relationship never holds exactly PPP equation gives a sense of a long-term tendency towards which nominal exchange rates move absent other changes ...
... PPP Model as Special Case Real exchange rate equation captures reality at any point in time PPP relationship never holds exactly PPP equation gives a sense of a long-term tendency towards which nominal exchange rates move absent other changes ...
This PDF is a selection from an out-of-print volume from... Bureau of Economic Research Volume Title: Inflation: Causes and Effects
... power parities can be expected to hold in the long run only if most of the shocks to the system are of a monetary origin and do not require changes in relative prices. To the extent that most of the shocks reflect "real" changes (like differential growth rates among sectors), the required changes in ...
... power parities can be expected to hold in the long run only if most of the shocks to the system are of a monetary origin and do not require changes in relative prices. To the extent that most of the shocks reflect "real" changes (like differential growth rates among sectors), the required changes in ...
NBER WORKING PAPER SERIES THE INTERNATIONAL MONETARY SYSTEM: Jacob
... slope of the labor—demand schedule, especially if wage developments are dominsted by insiders with jobs rather than by outsiders without them. Surprisingly enough, disciplinary effects on ...
... slope of the labor—demand schedule, especially if wage developments are dominsted by insiders with jobs rather than by outsiders without them. Surprisingly enough, disciplinary effects on ...
Lecture 9 The Money Supply Process
... APPLICATION The 2007-2009 Financial Crisis and the Money Supply • During the recent financial crisis the monetary base more than tripled as a result of the Fed's purchase of assets and new lending facilities to stem the financial crisis. • The currency ratio fell somewhat during this per ...
... APPLICATION The 2007-2009 Financial Crisis and the Money Supply • During the recent financial crisis the monetary base more than tripled as a result of the Fed's purchase of assets and new lending facilities to stem the financial crisis. • The currency ratio fell somewhat during this per ...
Prospectus Defense - AIPRG -- Armenian International
... Government spending (GOV). Usually defined as the government consumption of the nontradable goods. Market openness (OPEN). A proxy for trade controls/ restrictions. Technological progress/productivity (TECHPRO). Allows capturing the famous BalassaSamuelson effect. ...
... Government spending (GOV). Usually defined as the government consumption of the nontradable goods. Market openness (OPEN). A proxy for trade controls/ restrictions. Technological progress/productivity (TECHPRO). Allows capturing the famous BalassaSamuelson effect. ...
Working Paper 74 – The Great Exchange Rate Debate after
... did they expect the nominal devaluation to exceed 60 percent.4 Growth forecasts for 2002 indicate that GDP will contract between 15 and 20 percent; for 2003 most analysts expect and additional drop in GDP of the order of 5 percent. These tragic events showed that in a de-facto dollarized economy a d ...
... did they expect the nominal devaluation to exceed 60 percent.4 Growth forecasts for 2002 indicate that GDP will contract between 15 and 20 percent; for 2003 most analysts expect and additional drop in GDP of the order of 5 percent. These tragic events showed that in a de-facto dollarized economy a d ...
7.4 Asset Market Approach
... The wealth of home residents is made up of three financial assets: home money, home bonds and foreign bonds. W M B e F Ms is controlled by the central bank; Md is inversely affected by r and r* and is positively affected by W. Bs is controlled by the government; Bd is inversely affected ...
... The wealth of home residents is made up of three financial assets: home money, home bonds and foreign bonds. W M B e F Ms is controlled by the central bank; Md is inversely affected by r and r* and is positively affected by W. Bs is controlled by the government; Bd is inversely affected ...
fixed and managed exchange rates
... Fiscal/monetary discipline domestically: This has been one of the main arguments in favour of fixed exchange rates. Recall that inflation and government deficits exert downward pressure on the exchange rate. Since the central bank will have to use limited foreign reserves to adjust the exchange rate ...
... Fiscal/monetary discipline domestically: This has been one of the main arguments in favour of fixed exchange rates. Recall that inflation and government deficits exert downward pressure on the exchange rate. Since the central bank will have to use limited foreign reserves to adjust the exchange rate ...
NBER WORKING PAPER SERIES MONETARY POLICY: DOMESTIC TARGETS AND INTERNATIONAL CONSTRAINTS
... involving specific pairs of assets. In evaluating these transactions it might be useful to explore the broader spectrum of possible policies. Figure 1 summarizes the various patrerns of domestic and foreign monetary policies and foreign ...
... involving specific pairs of assets. In evaluating these transactions it might be useful to explore the broader spectrum of possible policies. Figure 1 summarizes the various patrerns of domestic and foreign monetary policies and foreign ...
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... borrow. This could be the case, for instance, if co-ordination problems among international investors long in short term debt issued by a country lead to liquidity runs similar to bank runs. When markets co-ordinate on an equilibrium characterised by a run, the debtor country is forced to come up qu ...
... borrow. This could be the case, for instance, if co-ordination problems among international investors long in short term debt issued by a country lead to liquidity runs similar to bank runs. When markets co-ordinate on an equilibrium characterised by a run, the debtor country is forced to come up qu ...
EXCHANGE RATE AS AN INSTRUMENT OF ECONOMIC POLICY
... The exchange rate has the most direct impact on the economic growth of a country through its influence on foreign trade. The hypothesis of an economic growth based on exports sees the export expansion as one of the most important determinants of the growth which is based on technological accelerati ...
... The exchange rate has the most direct impact on the economic growth of a country through its influence on foreign trade. The hypothesis of an economic growth based on exports sees the export expansion as one of the most important determinants of the growth which is based on technological accelerati ...
Slide 1 - UTA.edu
... contract is purchased in Canadian $, the trader never has to take delivery of Canadian $ as a result of the contract if they don’t wish to. In other words, the trader has the right, but not the obligation to take delivery of currency in the future. The trader will only use the option if the movement ...
... contract is purchased in Canadian $, the trader never has to take delivery of Canadian $ as a result of the contract if they don’t wish to. In other words, the trader has the right, but not the obligation to take delivery of currency in the future. The trader will only use the option if the movement ...
Document
... phase and to increase in the second. As exchange rate policy initially enjoys credibility, arbitrage between domestic and foreign assets leads to a reduction of domestic interest rates. Low interest rates contribute to the real and financial expansion. In the second phase the interest rates rise. Th ...
... phase and to increase in the second. As exchange rate policy initially enjoys credibility, arbitrage between domestic and foreign assets leads to a reduction of domestic interest rates. Low interest rates contribute to the real and financial expansion. In the second phase the interest rates rise. Th ...
Key Development at a Glance - Claremont Graduate University
... ---Globalization accelerates the adjustment of industries which results in the increase of manufacturing trading. ---Limitations of techniques from developed countries. ---Unfairness in international system. B.From domestic side ---high ratio of savings/investment ---large surplus of capital owing t ...
... ---Globalization accelerates the adjustment of industries which results in the increase of manufacturing trading. ---Limitations of techniques from developed countries. ---Unfairness in international system. B.From domestic side ---high ratio of savings/investment ---large surplus of capital owing t ...
Document
... Two possible systems for fixing the exchange rates: • Reserve currency standard – Central banks peg the prices of their currencies in terms of a reserve currency. – The currency central banks hold in their international reserves. ...
... Two possible systems for fixing the exchange rates: • Reserve currency standard – Central banks peg the prices of their currencies in terms of a reserve currency. – The currency central banks hold in their international reserves. ...
krugmanobstfeldch17.pp
... Two possible systems for fixing the exchange rates: • Reserve currency standard – Central banks peg the prices of their currencies in terms of a reserve currency. – The currency central banks hold in their international reserves. ...
... Two possible systems for fixing the exchange rates: • Reserve currency standard – Central banks peg the prices of their currencies in terms of a reserve currency. – The currency central banks hold in their international reserves. ...
Reforming the Transmission Mechanism of Monetary Policy in China
... the credit behaviors of commercial banks, and on the trend of interest rates and money demand. At the same time, the PBC widened the floating range, allowed commercial banks to flexibly determine the discount rates according to the risk and creditworthiness of enterprises, thus helped to develop the ...
... the credit behaviors of commercial banks, and on the trend of interest rates and money demand. At the same time, the PBC widened the floating range, allowed commercial banks to flexibly determine the discount rates according to the risk and creditworthiness of enterprises, thus helped to develop the ...
Problem Set #1 - Wharton Finance Department
... that the higher US interest rates should attract foreign capital into the US and raise the FC value of the USD. However, in response to the rate increase, the value of the dollar fell slightly against all major currencies. Foreign central banks did not alter their interest rates on that day. Offer a ...
... that the higher US interest rates should attract foreign capital into the US and raise the FC value of the USD. However, in response to the rate increase, the value of the dollar fell slightly against all major currencies. Foreign central banks did not alter their interest rates on that day. Offer a ...
Money and Finance - Department of Economics
... Organizer with Roberto Cortes-Condé of an "A" Session, "The Legacy of Western European Fiscal and Monetary Institutions for the New World: The Seventeenth to the Nineteenth Centuries." Twelfth International Economic History Congress, Seville, Spain. August 1998. Organizer with Roberto Cortes-Condé o ...
... Organizer with Roberto Cortes-Condé of an "A" Session, "The Legacy of Western European Fiscal and Monetary Institutions for the New World: The Seventeenth to the Nineteenth Centuries." Twelfth International Economic History Congress, Seville, Spain. August 1998. Organizer with Roberto Cortes-Condé o ...
An Iron Law of Currency Crises: The Divergence of the Nominal and
... A. Non sustainable current account deficits In a portfolio equilibrium with different currencies two different situations can be distinguished. If the expected rates of return of assets denominated in different currencies are identical (including expected exchange rate changes as part of the rates o ...
... A. Non sustainable current account deficits In a portfolio equilibrium with different currencies two different situations can be distinguished. If the expected rates of return of assets denominated in different currencies are identical (including expected exchange rate changes as part of the rates o ...
The mechanics of money supply determination
... (Assume US is domestic country and UK is foreign country) Trade (current account) balance: exports minus imports Capital account balance: capital inflows (borrowing) minus capital outflows (lending) The balance of payments = trade balance plus capital account balance = sources minus uses of foreign ...
... (Assume US is domestic country and UK is foreign country) Trade (current account) balance: exports minus imports Capital account balance: capital inflows (borrowing) minus capital outflows (lending) The balance of payments = trade balance plus capital account balance = sources minus uses of foreign ...
Is the Gold Standard Still the Gold Standard among Monetary Systems? No. 100
... (that is, against even time deposits). With a historically more reasonable fractional reserve ratio of 2 percent, the amount of gold needed in vaults and thus the resource cost of a gold standard shrinks by a factor of 50.13 Friedman wanted to substitute for gold a less costly paper money standard b ...
... (that is, against even time deposits). With a historically more reasonable fractional reserve ratio of 2 percent, the amount of gold needed in vaults and thus the resource cost of a gold standard shrinks by a factor of 50.13 Friedman wanted to substitute for gold a less costly paper money standard b ...
12. Impact of Currency Devaluation on Economic Growth of Nigeria
... forced into devaluation by an ominous trade deficit. Thailand, China, Mexico, Czech Republic - all devalued strongly, willingly or unwillingly, after their trade deficits exceeded 8% of the GDP. Devaluation of currency is decided by the government issuing the currency, and is the result of governmen ...
... forced into devaluation by an ominous trade deficit. Thailand, China, Mexico, Czech Republic - all devalued strongly, willingly or unwillingly, after their trade deficits exceeded 8% of the GDP. Devaluation of currency is decided by the government issuing the currency, and is the result of governmen ...
International Monetary System
... themselves of dollars and get gold in return. If they did this, however, international trade and the international monetary system might collapse because the United States did not have enough gold to redeem all the dollars held by foreigners. ...
... themselves of dollars and get gold in return. If they did this, however, international trade and the international monetary system might collapse because the United States did not have enough gold to redeem all the dollars held by foreigners. ...