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Prospects for global current account rebalancing

Beaton, Kimberly; De Resende, Carlos; Lalonde, René; … - 2010

imbalances relies on three key elements: (i) a continuous upward adjustment of U.S. private savings, (ii) fiscal consolidation in … advanced countries, and (iii) an orderly adjustment of exchange rates. These three criteria facilitate a gradual decline in the …

Persistent link: https://www.econbiz.de/10003981363

External Stability, Real Exchange Rate Adjustment and the Exchange Rate Regime in Emerging-Market Economies

Gervais, Olivier; Schembri, Lawrence; Suchanek, Lena - Bank of Canada - 2011

In emerging-market economies, real exchange rate adjustment is critical for maintaining a sustainable current account … hypotheses: (i) that real exchange rate flexibility and adjustment promotes external stability, and (ii) that a flexible nominal … exchange rate facilitates real exchange rate adjustment. Based on an event-study analysis for a large set of emerging …

Persistent link: https://www.econbiz.de/10009323066

Determinants of Financial Stress and Recovery during the Great Recession

Aizenman, Joshua; Pasricha, Gurnain Kaur - Bank of Canada - 2011

In this paper, we explore the link between stress in the domestic financial sector and the capital flight faced by countries in the 2008-9 global crisis. Both the timing of emergence of internal financial stress in developing economies, and the size of the peak-trough declines in the stock price...

Persistent link: https://www.econbiz.de/10009359840

Effectiveness of Capital Controls in India: Evidence from the Offshore NDF Market

Hutchison, Michael; Pasricha, Gurnain Kaur; Singh, Nirvikar - Bank of Canada - 2011

This paper examines the effectiveness of international capital controls in India over time by analyzing daily return differentials in the non-deliverable forward (NDF) markets using the self-exciting threshold autoregressive (SETAR) methodology. We begin with a detailed narrative on the...

Persistent link: https://www.econbiz.de/10009368873

Canada's Pioneering Experience with a Flexible Exchange Rate in the 1950s: (Hard) Lessons Learned for Monetary Policy in a Small Open Economy

Bordo, Michael; Dib, Ali; Schembri, Lawrence - Bank of Canada - 2007

This paper revisits Canada's pioneering experience with floating exchange rate over the period 1950–1962. It examines whether the floating rate was the best option for Canada in the 1950s by developing and estimating a New Keynesian small open economy model of the Canadian economy. The model...

Persistent link: https://www.econbiz.de/10005673297

Endogenous Borrowing Constraints and Consumption Volatility in a Small Open Economy

Resende, Carlos de - Bank of Canada - 2006

Consumption volatility relative to output volatility is consistently higher in emerging economies than in developed economies. One natural explanation is that emerging economies are more likely to face borrowing constraints and, as a consequence, find it more difficult to use international...

Persistent link: https://www.econbiz.de/10005673362

A Wave of Protectionism? An Analysis of Economic and Political Considerations

Maier, Philipp - Bank of Canada - 2008

In light of the U.S. current account deficit, pressure is high on Asian countries to revalue their currencies. The calls from some U.S. policymakers for tariffs on imports from China has sparked fears that this could trigger a world-wide surge in protectionism. This study evaluates the risk of...

Persistent link: https://www.econbiz.de/10005673368

The Bank of Canada's Version of the Global Economy Model (BoC-GEM)

Lalonde, Rene; Muir, Dirk - Bank of Canada - 2007

The Bank of Canada's version of the Global Economy Model (BoC-GEM) is derived from the model created at the International Monetary Fund by Douglas Laxton (IMF) and Paolo Pesenti (Federal Reserve Bank of New York and National Bureau of Economic Research). The GEM is a dynamic stochastic...

Persistent link: https://www.econbiz.de/10005808259

A Structural VAR Approach to the Intertemporal Model of the Current Account

Kano, Takashi - Bank of Canada - 2003

The intertemporal current account approach predicts that the current account of a small open economy is independent of global shocks, and that responses of the current account to country-specific shocks depend on the persistence of the shocks. The author shows that these predictions impose...

Persistent link: https://www.econbiz.de/10005808320

Prospects for Global Current Account Rebalancing

Beaton, Kimberly; Resende, Carlos de; Lalonde, René; … - Bank of Canada - 2010

Persistent link: https://www.econbiz.de/10008552484