Read Can Higher Reserves Help Reduce Exchange Rate Volatility?

Can Higher Reserves Help Reduce Exchange Rate Volatility?

Ketil Hviding

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Description: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 and external indicators as well as conventional macroeconomic fundamentals). The paper controls for the endogeneity induced by the role of the exchange rate regime, since the regime can affect both the level of reserves and exchange rate volatility. The results provide ample support for the proposition that holding adequate reserves reduces exchange rate volatility. The effect is strong and robust; moreover, it is nonlinear and appears to operate through a signaling effect.We have made it easy for you to find a PDF Ebooks without any digging. And by having access to our ebooks online or by storing it on your computer, you have convenient answers with Can Higher Reserves Help Reduce Exchange Rate Volatility?. To get started finding Can Higher Reserves Help Reduce Exchange Rate Volatility?, you are right to find our website which has a comprehensive collection of manuals listed.
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Pages: 68

Format: PDF, EPUB & Kindle Edition

Publisher: International Monetary Fund

Release: 2004

ISBN: 1282076434

Description: 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 and external indicators as well as conventional macroeconomic fundamentals). The paper controls for the endogeneity induced by the role of the exchange rate regime, since the regime can affect both the level of reserves and exchange rate volatility. The results provide ample support for the proposition that holding adequate reserves reduces exchange rate volatility. The effect is strong and robust; moreover, it is nonlinear and appears to operate through a signaling effect.We have made it easy for you to find a PDF Ebooks without any digging. And by having access to our ebooks online or by storing it on your computer, you have convenient answers with Can Higher Reserves Help Reduce Exchange Rate Volatility?. To get started finding Can Higher Reserves Help Reduce Exchange Rate Volatility?, you are right to find our website which has a comprehensive collection of manuals listed.
Our library is the biggest of these that have literally hundreds of thousands of different products represented.

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Can Higher Reserves Help Reduce Exchange Rate Volatility?

Can Higher Reserves Help Reduce Exchange Rate Volatility?

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