This paper examines the implications of Nepal’s exchange rate policy for its export performance over the period 1980–2010. We first document Nepal’s long-standing currency peg against the Indian rupee and that Nepal’s real exchange rate appreciated substantially from the late 1990s. We...

Using UK data over the 1973q1-2004q1 period, we find that the dynamics of the real exchange rate, real wages and unemployment vary both with large versus small real exchange rate disequilibria and rising versus falling unemployment regimes. The short-run real exchange rate adjusts only when...

International pressure to revalue China’s currency stems in part from the expectation that rapid economic growth should be associated with an underlying real exchange rate appreciation. This hinges on the Balassa-Samuelson hypothesis, which sees growth as stemming from improvements in traded...

This paper examines post-crisis export performance in Thailand against the backdrop of pre-crisis experience and ongoing changes in patterns of international production. Following a stage-setting survey of trends and patterns of export performance over the past four decades, it focuses on two...

The nexus of real exchange rate (RER) and capital inflows is examined through a comparative analysis of the experiences of emerging market economies in Asian and Latin America during the period 1985-2000. It is found that the degree of appreciation in RER associated with capital inflow is...

This paper explores the 'problem' of the impact of capital inflow on the real exchange rate in countries in Asia and Latin America, as discussed by Athukorala and Rajapatirana. It points out some shortcomings in their characterisation of the data, some inconsistencies in the data as presented,...

This paper re-examines Athukorala and Warr's ex post investigation of several Asian countries' vulnerability to balance of payments crises. It argues that their focus on 'mobile capital' is flawed in two important aspects. It also questions their ideas about exchange rate 'overvaluation', and...

After decades using monetary aggregates as the main instrument of monetary policy and having different varieties of crawling peg exchange rate regimes, Colombia adopted a full-fledged inflation-targeting (IT) regime in 1999, with inflation as the nominal anchor, a floating exchange rate, and the...

Banco de la República's FX intervention policy is described, with a focus on its objectives and main features. Then, based on a survey of the effectiveness of sterilized intervention in Colombia, it is argued that this tool is not useful to cope with the challenges posed by medium term external...

In this paper we study the effect of monetary policy shocks on commodity prices. While most of the literature has found that expansionary shocks have a positive effect on aggregate price indices, we study the effect on individual prices of a sample of four commodities. This set of commodity...