Resources
BNET Resources
- sort by:
- Relevance
- Date
- Popularity
- Can Higher Reserves Help Reduce Exchange Rate Volatility?
- This paper studies the role of an increase in foreign exchange reserves in reducing currency volatility for emerging market countries. The study employs a panel of 28 countries over the period 1986-2002. Several control variables are introduced in the regressions to account for other factors affecting exchange rate volatility (monetary...
- White papers 2004-10-01
- Trade Costs and Real Exchange Rate Volatility: The Role of Ricardian Comparative Advantage
- This paper examines the impact of trade costs on real exchange rate volatility. It incorporates a multi-country Ricardian model of trade, based on the work of Eaton and Kortum (2002), into a macroeconomic model to show how bilateral real exchange rate volatility depends on relative technological differences and trade costs....
- White papers 2005-01-01
- Exchange Rate Volatility And Productivity Growth: The Role Of Financial Development
- This paper offers empirical evidence that real exchange rate volatility can have a significant impact on long-term rate of productivity growth, but the effect depends critically on a country's level of financial development. For countries with relatively low levels of financial development, exchange rate volatility generally reduces growth, whereas for...
- White papers 2006-03-06
- Identifying The Relationship Between Trade And Exchange Rate Volatility
- The authors have developed a model of international trade in which trade depresses real exchange rate volatility and exchange rate volatility impacts trade in products differently according to their degree of differentiation. In particular, commodities are less affected by exchange rate volatility than more highly differentiated products. These insights allow...
- White papers 2004-02-01
Additional Resources
- Structural Factors Affecting Exchange Rate Volatility: A Cross-Section Study
- The paper examines factors affecting exchange rate volatility, with an emphasis on structural features of the foreign exchange regime. It draws for the first time on detailed survey data collected by the IMF on foreign exchange market organization and regulations. Key findings are that decentralized dealer markets, regulations on the...
- White papers 2004-08-01
- Remoteness and Real Exchange Rate Volatility
- This paper examines the impact of trade costs on real exchange rate volatility. The channel is examined by constructing a two-country Ricardian model of trade, based on the work of Dornbusch, Fischer, and Samuelson (1977), which shows that higher trade costs result in a larger nontradable sector. This, in turn,...
- White papers 2005-01-01
- Endogenous Exchange Rate Pass-through when Nominal Prices are Set in Advance
- This paper develops a model of endogenous exchange rate pass through within an open economy macroeconomic framework, where both pass-through and the exchange rate are simultaneously determined, and interact with one another. Pass-through is endogenous because firms choose the currency in which they set their export prices. There is a...
- White papers 2003-03-07
- The Endogeneity Of The Exchange Rate As A Determinant Of FDI: A Model Of Entry And Multinational Firms
- This paper argues that when the exchange rate and projected sales in the host country are jointly determined by underlying macroeconomic variables, standard regressions of FDI Foreign Direct Investment flows on both exchange rate levels and volatility are subject to bias. The results hinge on the interaction of macroeconomic uncertainty,...
- White papers 2005-10-01
- The Endogeneity Of The Exchange Rate As A Determinant Of FDI
- Existing theoretical and empirical studies draw conflicting conclusions as to whether exchange rate volatility will encourage or suppress FDI Foreign Direct Investment, largely because they divorce exchange rate fluctuations from economic conditions within the host country. This paper argues that the exchange rate and projected sales in the host country...
- White papers 2003-11-20
- When Do Central Bank Interventions Influence Intra-Daily and Longer-Term Exchange Rate Movements?
- This paper examines dollar interventions by the G3 governments since 1989, and the reasons that trader reactions to these interventions might differ over time and across central banks. Market microstructure theory provides a framework for understanding the process by which sterilized central bank interventions are observed and interpreted by traders,...
- White papers 2003-07-24
- Productivity Growth And The Exchange Rate Regime: The Role Of Financial Development
- This paper offers empirical evidence that a country's choice of exchange rate regime can have a significant impact on its medium-term rate of productivity growth. Moreover, the impact depends critically on the country's level of financial development, its degree of market regulation, and its distance from the global technology frontier....
- White papers 2005-05-10
- ECB says still "concerned" about excessive exchange rate moves
- FRANKFURT AFP ? The European Central Bank said it remained "concerned" about excessive exchange rate volatility as the euro moves back close to record highs following the latest comments by US Federal Reserve Chairman Alan Greenspan. "With regard to exchange rates, the governing council again stressed stability and it...
- Research articles 2004-02-12
- The Effect Of Exchange Rate Uncertainty On Foreign Direct Investment In The United Kingdom
- This paper assesses the impact of the level and variability of the exchange rate on the flow of foreign direct investment into the United Kingdom from 1997 to 2000. An original database is used consisting of firm level announcements of investment recorded and compiled by Ernst & Young, focussing on...
- White papers 2003-07-01
- Exchange Rate Volatility and the Credit Channel in Emerging Markets: A Vertical Perspective
- Firms in emerging markets are exposed to severe financial frictions and credit constraints that are exacerbated by the sudden stop of capital inflows. Can monetary policy offset this external credit squeeze? The paper shows that although this may be the case during moderate contractions or in partial equilibrium, the expansionary...
- White papers 2004-05-01
- Monetary Policy and Exchange Rate Volatility in a Small Open Economy
- This report lays out a small open economy version of the Calvo sticky price model, and shows how the equilibrium dynamics can be reduced to a tractable canonical system in domestic inflation and the output gap. It employs this framework to analyze the macroeconomic implications of three alternative monetary policy...
- White papers 2002-04-01
- Assessing Exchange Rate Risk
- When companies undertake international business, they take a risk because their investments and business operations may be affected by changes in the exchange rates for different currencies. This risk is known as exchange rate risk.Increasingly, companies are fighting for a slice of global markets, particularly in developing nations, and putting...
- Articles 2007-12-06
- Does central bank intervention stabilize foreign exchange rates?
- Since the adoption of a flexible exchange rate system in 1973, central banks of most industrialized countries have continued to intervene in foreign exchange markets. One reason is that exchange rate volatility has increased. To reduce volatility, many European countries have agreed to keep exchange rates within a band around...
- Research articles 1996-01-01
- ECB's Trichet stresses excessive forex volatility 'undesirable'
- BERLIN AFP — ECB president Jean-Claude Trichet reiterated on Friday that excessive exchange rate volatility is "undesirable," as the euro flirted with all-time highs against the dollar and the yen. "Excessive volatility and disorderly movements in exchange rates are undesirable for economic growth," he told journalists after a meeting...
- Research articles 2007-04-20
- Central Bank Foreign Exchange Market Intervention And Option Contract Specification: The Case of Colombia
- This article aims to identify appropriate option contract specification for effective central bank exchange market intervention. Option contract specification determines the impact of options on the underlying asset or currency, and hence, their actual effect on asset price or currency volatility and are therefore key in determining the effectiveness of...
- White papers 2003-06-01
- Does Exchange Rate Risk Matter for Welfare?
- Volatility in exchange rates is a prominent feature of open economies, a fact which has motivated elaborate attempts in many countries at exchange rate management. This paper analyzes quantitatively the welfare effects of exchange rate risk in a general two-country environment. It finds that the effects of uncertainty tend to...
- White papers 2003-08-13
- << Previous
- page 1 of 1
- Next >>
Presented by American Express