Policymakers have relied on a wide range of policy tools to cope with capital flow shocks. And yet, the effects and interaction of these policies remain under debate, as does the motivation for using them. In this paper, quantile local projections are used to estimate the entire distribution of...

We discuss the role of sterilized FX interventions as a monetary policy instrument in response to external shocks for emerging market economies. In our model, banks face an agency problem that constrains their ability to obtain funds denominated in domestic and foreign currency. The severity of...

Supply shocks bring about important dilemmas for monetary policy in emerging economies. We compute monetary policy responses to supply shocks using quarterly data and a Bayesian panel VAR for 24 emerging economies during the period 2004-2019. In this framework, we identify supply shocks as...