Many central banks actively intervene in the foreign exchange (forex) market, although there is no consensus on its impact on the exchange rate level and volatility. We analyze the effects of daily forex interventions in four Latin American countries with inflation targets — namely, Chile,...

Emerging economies with inflation targets (IT) face a dilemma between fulfilling the theoretical conditions of "strict IT", which imply a fully flexible exchange rate, or applying a "flexible IT", which entails a de facto managed floating exchange rate with FX interventions to moderate exchange...

This paper analyzes the international monetary transmission mechanism in economies with portfolio rigidities. In a general equilibrium monetary model with distribution costs in trade, I analyze the reaction of the economy to technology, money supply and government spending shocks, and the...

Despite the general belief among economists on the growth-enhancing role of international trade and significant trade opening over the past 25 years, the growth performance of many developing economies, especially of those in Latin America and Africa, has been disappointing. While this poor...

The removal of barriers to trade and mobility is usually promoted as it allows for greater division of labor and, thereby, for improved economic welfare. Recent theory, however, suggests that the integration of markets might have serious consequences for the regional allocation of economic...

The International Investment Position records the value of foreign assets and liabilities of an economy in a given date. Its evolution is determined by the financial transactions of the Balance of Payments, which affects the volume of assets and liabilities, by differences in the valuation of...

Monetary union in Europe raises the problem of converting into euros nominal historical series calculated in the respective national currencies. The aim of this paper is to evaluate alternative conversion procedures, including use of the rates fixed at the start of Stage Three between the...

In this study it is attempted to estimate the amount of speculation in foreign exchange market.

One and three-month forward exchange rates for the deustche mark, french franc, sterling pound, yen and peseta, relative to the US dollar, seem to be cointegrated with future spot rates, but not with current exchange rates. We confirm the unbiasedness hypothesis for this data set, as a robust...

This paper studies the pass-through of exchange rate changes into the prices of imports that originated inside the euro area made by some New Member States (NMSs) of the European Union and one candidate country (Turkey). I use data on import unit values for nine different product categories and...