We extend a standard New Keynesian model both to incorporate heterogeneity in spending opportunities along with two sources of (potentially time-varying) credit spreads and to allow a role for the central bank's balance sheet in determining equilibrium. We use the model to investigate the...

This paper develops a forward-looking model for import demand under a foreign exchange constraint, in which import growth is an increasing function of contemporaneous and expected future export growth. ; Unlike existing models which stress the role of foreign exchange reserves and...