Foreign exchange reserves are an integral part of the policy toolkit in African countries. Based on a survey of African central banks, this paper relates the reasons for holding reserves to some of the economic circumstances in their countries. It also discusses how African central banks address...

Policy normalisation in the major advanced economies affects emerging market economies (EMEs) through many channels, posing major challenges for their central banks. EMEs have adopted a policy toolkit including monetary, fiscal, exchange rate and macroprudential policies. Given many EMEs' high...

This paper reviews the Peruvian experience in using FX intervention and reserve requirements for macroprudential purposes, with the aim of limiting the financial risks associated with dollarisation. Peru is a successful market-driven case of dedollarisation, which reflects both macroeconomic...

This note outlines Mexico's recent experience with three closely interrelated issues. First, on the basis of a legal framework regulating transactions in foreign currency between the central bank and government entities, and preannounced market-based mechanisms, the stock of international...

The shift in global monetary policy from quantitative easing (QE) to the subsequent policy normalisation has led to volatile two-way capital flows for the emerging market economies (EMEs). Many EMEs' central banks have faced considerable challenges in maintaining monetary and financial stability...

Korea's FX reserves have increased steadily since 2008, to a total of $404 billion as of the end of 2018. This has helped reduce private foreign currency funding costs and exchange rate volatility by contributing to a stable sovereign credit rating. In turn, this has helped to stabilise domestic...

Reserve portfolios prior to the Global Financial Crisis provided positive (low) returns for central banks or had extremely low probabilities of earning negative returns. In the wake of the crisis, expansionary monetary policy created a low yield environment at a scale that was never seen before....

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....

Two FX policy issues are discussed based on the recent Colombian experience. First, the increased participation of foreign investors in local bond markets since 2014 induced a reassessment of international reserve adequacy. We present the resulting Liquidity Coverage Ratio-type methodology to...