December 2000 <p> This paper evaluates the performance of exchange rate, inflation and money targeting under terms of trade, real interest rate, foreign inflation and money demand shocks. Inflation targeting must target the price level as opposed to forward looking inflation for uniqueness of...</p>

August 2000 <p> This paper analyzes daily covered interbank interest differentials for three emerging markets before and after the 1997/8 financial crises, and compares them to those of four developed economies. It examines descriptive statistics of covered differentials and the long-run...</p>

June 2000 (Revised) <p> This paper presents a dynamic general equilibrium model of balance of payments crises to analyze the role of sterilization policies during speculative attacks. It is shown that if domestic bond interest rates are not allowed to rise real money balances increase and the...</p>

July 2000 (Revised) <p> The paper analyzes an open economy where fiscal deficits are incompatible with an inflation target, ultimately leading to a speculative attack. There are two differences to the exchange rate targeting case: (i) The attack takes place over a short period of time as opposed to...</p>

October 2000 <p> Reductions in international interest rates are a major cause of capital flows to emerging economies. Increases in domestic interest rates are a frequent policy response to the resulting price increases. This is often unsuccessful. The paper suggests a theoretical explanation based...</p>

November 2000 <p> This paper presents a critical appraisal of inflation targeting as a monetary policy regime for emerging markets. It is shown that this policy, if understood as a strict commitment to a CPI inflation target, shares many features with exchange rate targeting and is quite different...</p>

October 2000 <p> The quantitative implications of a model of balance of payments crises are explored. The model analyzes government sterilization of capital outflows through low interest rates on domestic debt. This prevents a collapse in money demand but instead leads to a collapse in bond demand...</p>