"Most intervention studies have been silent on the assumed structure of the economic system--implicitly imposing implausible assumptions--despite the fact that inference depends crucially on such issues. This paper proposes to identify the cross-effects of intervention with the level and...

The foreign exchange reserves of the Czech National Bank (CNB) increased roughly three and a half times to EUR 124.6 billion while the exchange rate commitment was in place between November 2013 and April 2017. This unprecedented growth has led the CNB to review how the reserves are managed....

This paper presents a small open economy model to analyze the role of central bank liquidity management in implementing “unconventional” monetary policies within an inflation targeting framework. In particular, the paper explicitly models the facilities that the central bank uses to manage...

Central bank balance sheets in emerging Asia have been expanding rapidly for the past decade, driven primarily by the accumulation of foreign exchange reserves. Some of the expansion reflects efforts to increase the buffer stock of reserves in the aftermath of the 1997–98 Asian Financial...

The zero level of interest rates constitutes a limit of this standard monetary policy instrument. Based on the example of the Czech Republic we argue that in such a situation foreign exchange interventions represent a meaningful monetary policy tool for small open economies not facing serious...

In 1936-37, the Federal Reserve doubled the reserve requirements imposed on member banks. Ever since, the question of whether the doubling of reserve requirements increased reserve demand and produced a contraction of money and credit, and thereby helped to cause the recession of 1937-1938, has...