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discusses the interaction of inflation and exchange rate policy in a variety of contexts. Four different settings are used to … in the transition from high to even higher inflation discussed in the context of Brazil; exchange rate fixing and real … deviatiins arise and how they influence inflation, trade and capital flight …
Persistent link: https://www.econbiz.de/10014106258
This paper estimates simultaneously dynamic equations for the Deutsche Mark/Dollar exchange rate and the German wholesale price index, which emerge from a model in which German prices are sticky. This stickiness is due to price adjustment costs which take the form posited by Rotemberg(1982).The...
Persistent link: https://www.econbiz.de/10013220974
It is almost invariably taken for granted in theoretical descriptions of the international price mechanism and in the construction of trade models that a country's export price for a particular product is identical to its domestic price. Any impact of foreign or domestic events on prices is...
Persistent link: https://www.econbiz.de/10013221992
The most important conclusion of this paper is that the growth rate of the money supply influences the U.S. inflation …, help to explain why U.S. inflation was so low in 1976 and why it accelerated so rapidly in 1978. Granger causality tests … indicate that lagged exchange rate changes influence inflation, but lagged inflation does not cause exchange rate changes. A …
Persistent link: https://www.econbiz.de/10013224206
interest, inflation, currency depreciation and inflation differentials. Forward rates are related to these expected future … variables via combinations of term, inflation and foreign exchange risk premia. A unified derivation, discussion and comparison …
Persistent link: https://www.econbiz.de/10013225406
This paper studies the behavior of inflation after nine large post-1990 contractionary devaluations. A salient feature … of the data is that inflation is low relative to the rate of devaluation. We argue that distribution costs and …
Persistent link: https://www.econbiz.de/10013226060
yields on long maturity inflation - indexed bonds. This relationship can be interpreted as defining the fair value of the … exchange rate that will prevail in any model or real world economy in which inflation indexed bonds are traded. An advantage of … with a 50 basis point rise in the inflation indexed bond return differential in favor of the foreign country and an 50 …
Persistent link: https://www.econbiz.de/10013087887
inflation rates account for a share of the PPP changes, although less so for the 2011 revisions than prior ICP rounds. A marked …
Persistent link: https://www.econbiz.de/10013050153
reforms may cause jumps in inflation and the exchange rate through their impact on the government budget. In order to achieve … a sustainable reduction in inflation an exchange rate freeze or crawling peg is shown to require restrictions not only …-collapse inflation will exceed the rate prevailing before the freeze started …
Persistent link: https://www.econbiz.de/10013246289
When the goals of internal and external macroeconomic equilibrium are in conflict, sterilized intervention in the foreign exchange market may provide an independent policy instrument through which the central bank can resolve its dilemma in the short run. This paper is concerned with the West...
Persistent link: https://www.econbiz.de/10013246518