scholarly journals Capital Controls or Exchange Rate Policy? A Pecuniary Externality Perspective

2012 ◽  
Author(s):  
Gianluca Benigno ◽  
Christopher Otrok ◽  
Alessandro Rebucci ◽  
Eric R. Young ◽  
Huigang Chen
Keyword(s):  
Exchange Rate ◽  
Capital Controls ◽  
Exchange Rate Policy ◽  
Pecuniary Externality ◽  
Rate Policy

scholarly journals Capital Controls or Real Exchange Rate Policy? A Pecuniary Externality Perspective

2013 ◽  
Author(s):  
Gianluca Benigno ◽  
Huigang Chen ◽  
Alessandro Rebucci ◽  
Christopher Otrok ◽  
Eric Young
Keyword(s):  
Exchange Rate ◽  
Real Exchange Rate ◽  
Capital Controls ◽  
Exchange Rate Policy ◽  
Pecuniary Externality ◽  
Rate Policy

scholarly journals Capital Controls or Exchange Rate Policy? A Pecuniary Externality Perspective

2012 ◽  
Author(s):  
Gianluca Benigno ◽  
Huigang Chen ◽  
Christopher Otrok ◽  
Alessandro Rebucci ◽  
Eric R. Young
Keyword(s):  
Exchange Rate ◽  
Capital Controls ◽  
Exchange Rate Policy ◽  
Pecuniary Externality ◽  
Rate Policy

MANAGING FLEXIBILITY: JAPANESE EXCHANGE RATE POLICY, 1971–2007

2007 ◽  
Vol 52 (03) ◽  
pp. 335-361 ◽  
Author(s):  
SHINJI TAKAGI
Keyword(s):  
Exchange Rate ◽  
Capital Controls ◽  
Exchange Rate Policy ◽  
Foreign Exchange Intervention ◽  
Bretton Woods ◽  
Capital Account Convertibility ◽  
Rate Policy ◽  
Account Convertibility ◽  
Leaning Against The Wind

The paper reviews Japan's exchange rate policy from the end of the Bretton Woods era to the present. The Japanese authorities used various tools to manage the yen–dollar exchange rate over much of this period. The most dominant was official foreign exchange intervention, which in most instances took the form of "leaning against the wind". Capital controls were also used but, with full capital account convertibility, ceased to exist as an instrument of exchange rate policy by the mid-1980s. Following the post-Plaza appreciation of the yen, the authorities eased monetary policy to arrest the appreciating pressure. The possible role of exchange rate policy in the great asset inflation that followed, however, remains unanswered. More recently, exchange rate policy during the period of prolonged stagnation and fragile recovery was made subordinate to the overall stance of macroeconomic policy. In this regard, particularly striking in terms of scale and frequency was the "great intervention" of 2003–2004. Equally striking has been the total absence of official intervention since. It would require a renewed substantial volatility of the yen to know whether this indeed marks a permanent shift in Japan's exchange rate policy.

The Evolution of Exchange Rate Policy and Capital Controls in Australia

2006 ◽  
Vol 5 (2) ◽  
pp. 7-29 ◽  
Author(s):  
Guy Debelle ◽  
Michael Plumb
Keyword(s):  
Exchange Rate ◽  
Extended Period ◽  
Capital Controls ◽  
Flexible Exchange Rate ◽  
Exchange Rate Policy ◽  
Reform Process ◽  
Bretton Woods ◽  
Floating Exchange Rate ◽  
Rate Policy ◽  
External Forces

After the end of the Bretton Woods system in the early 1970s, exchange rate policy in Australia moved through several regimes over an extended period. The overarching theme was to increase flexibility and efficiency in the Australian currency market and the financial system more generally. This paper documents Australia's gradual move from a fixed to a floating exchange rate and the abolition of capital controls, with an emphasis on the thinking behind various reforms and the practical difficulties encountered during the reform process. Policy reform was often in response to external forces exposing deficiencies in the prevailing system, rather than through a carefully planned path to greater flexibility. Ultimately, a combination of domestic and international factors rendered the move to a flexible exchange rate largely inevitable.

scholarly journals Notes on the Brazilian Crisis of 1997-99

2003 ◽  
Vol 23 (3) ◽  
pp. 376-404
Author(s):  
FRANCISCO L. LOPES
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Exchange Rate Regime ◽  
Capital Controls ◽  
Critical Issue ◽  
Exchange Rate Policy ◽  
The Real ◽  
Diagonal Band ◽  
Rate Policy ◽  
The Exchange Rate

ABSTRACT This paper deals with the Brazilian crisis of 1997-98 that lead to the exchange rate floating of January 1999. It starts by showing how exchange rate policy evolved since the Real Plan of 1994 and how the exchange rate regime became a critical issue when the crisis started in 1997. It discusses monetary policy during the crisis, the IMF program, the endogenous diagonal band and the decision to float as an alternative to capital controls and default. This five-year drama ended surprisingly well with a benign float, but it is useful to know its details, with the usual mix of economic de- bate, personality clashes and historical fatality.

Fear of Free Floating or Forced Exchange Rate Fixing

2004 ◽  
pp. 112-122
Author(s):  
O. Osipova
Keyword(s):  
Exchange Rate ◽  
Financial Crisis ◽  
Exchange Rates ◽  
Inflation Targeting ◽  
Exchange Rate Policy ◽  
Float Exchange Rate ◽  
Floating Exchange Rate ◽  
Rate Policy ◽  
Exchange Rate Arrangements ◽  
Pass Through

After the financial crisis at the end of the 1990 s many countries rejected fixed exchange rate policy. However actually they failed to proceed to announced "independent float" exchange rate arrangement. This might be due to the "fear of floating" or an irreversible result of inflation targeting central bank policy. In the article advantages and drawbacks of fixed and floating exchange rate arrangements are systematized. Features of new returning to exchange rates stabilization and possible risks of such policy for Russia are considered. Special attention is paid to the issue of choice of a "target" currency composite which can minimize external inflation pass-through.

Exchange Rate Regimes and Economic Stability

2010 ◽  
pp. 29-43
Author(s):  
S. Smirnov
Keyword(s):  
Exchange Rate ◽  
Inflation Targeting ◽  
Exchange Rate Regime ◽  
Exchange Rate Policy ◽  
Real Sector ◽  
Economic Stability ◽  
Exogenous Shocks ◽  
Floating Exchange Rate ◽  
Rate Policy ◽  
Managed Floating

The Bank of Russia intends to introduce inflation targeting policy and exchange rate free floating regime in three years. Exogenous shocks absorption which stabilizes the real sector of economy is usually considered to be one of the advantages of free floating exchange rate policy. However, our research based on the analysis of 25 world largest economies exchange rates and industrial production during the crisis of 2008-2009 does not confirm this hypothesis. The article also analyzes additional risks associated with free floating exchange rate regime in Russia and presents some arguments in favor of managed floating exchange rate regime.

On the Exchange Rate Policy

2010 ◽  
pp. 21-28
Author(s):  
K. Yudaeva
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Inflation Targeting ◽  
Exchange Rate Policy ◽  
Institutional Changes ◽  
Crisis Period ◽  
Local Currency ◽  
High Inflation ◽  
Rate Policy ◽  
The Exchange Rate

The level of trust in the local currency in Russia is very low largely because of relatively high inflation. As a result, Bank of Russia during crisis times can not afford monetary policy loosening and has to fight devaluation expectations. To change the situation in the post-crisis period Russia needs to live through a continuous period of low inflation. Modified inflation targeting can help achieve such a result. However, it should be amended with institutional changes, particularly development of hedging instruments.

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