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Inflation Targeting and Exchange Rate Management in Less Developed Countries

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Description:We analyze coordination of monetary and exchange rate policy in a two-sector model of a small open economy featuring imperfect substitution between domestic and foreign financial assets. Our central finding is that management of the exchange rate greatly enhances the efficacy of inflation targeting. In a flexible exchange rate system, inflation targeting incurs a high risk of indeterminacy where macroeconomic fluctuations can be driven by self-fulfilling expectations. Moreover, small inflation shocks may escalate into much larger increases in inflation ex post. Both problems disappear when the central bank leans heavily against the wind in a managed float.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 Inflation Targeting and Exchange Rate Management in Less Developed Countries. To get started finding Inflation Targeting and Exchange Rate Management in Less Developed Countries, you are right to find our website which has a comprehensive collection of manuals listed.
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Pages: 65

Format: PDF, EPUB & Kindle Edition

Publisher: International Monetary Fund

Release: 2016

ISBN: 1475523165

Description: We analyze coordination of monetary and exchange rate policy in a two-sector model of a small open economy featuring imperfect substitution between domestic and foreign financial assets. Our central finding is that management of the exchange rate greatly enhances the efficacy of inflation targeting. In a flexible exchange rate system, inflation targeting incurs a high risk of indeterminacy where macroeconomic fluctuations can be driven by self-fulfilling expectations. Moreover, small inflation shocks may escalate into much larger increases in inflation ex post. Both problems disappear when the central bank leans heavily against the wind in a managed float.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 Inflation Targeting and Exchange Rate Management in Less Developed Countries. To get started finding Inflation Targeting and Exchange Rate Management in Less Developed Countries, 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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Inflation Targeting and Exchange Rate Management in Less Developed Countries

Inflation Targeting and Exchange Rate Management in Less Developed Countries

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