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, exchange rate stability and financial integration subject to the constraints imposed by the Trilemma, in an era of widespread … globalization. In this paper we overview and contrast the Trilemma policy choices and tradeoffs faced by the two key drivers of … global economic growth-China and India. China’s Trilemma configurations are unique relative to other emerging markets in the …
Persistent link: https://www.econbiz.de/10010556944
Empirical estimates of the Reserve Bank of India's (RBI) intervention reaction function suggest that the central bank actively intervenes in the foreign exchange market to contain volatility but this intervention is neither continuous nor linear. It is better described by a nonlinear policy...
Persistent link: https://www.econbiz.de/10010572116
, exchange rate stability and financial integration subject to the constraints imposed by the Trilemma, in the era of deepening … globalization. In this paper we study the Trilemma choices of the two key drivers of global growth, China and India. We overview and … contrast the policy choices of the two, and test their Trilemma choices and tradeoffs. China’s Trilemma configurations are …
Persistent link: https://www.econbiz.de/10009359933
Central banks' international reserve holdings have increased significantly in the recent past. While traditional models fail to explain this accumulation of reserves, the more recent literature argues that reserves are used as a lifejacket against financial crises. However, research so far has...
Persistent link: https://www.econbiz.de/10010636245
The objective of this research was to identify the determinants of international reserves in Mexico. Using a Vector Error Correction Model, it was found that foreign portfolio investment has a significant positive effect on the demand for reserves both in the short run as in the long run. A...
Persistent link: https://www.econbiz.de/10013002565
This paper is concerned with international reserves where the accumulation of reserves is financed by public debt. Optimally controlled paths are used to illustrate the possibility of long term instability in a small macroeconomic system. The results indicate that reserve accumulation financed...
Persistent link: https://www.econbiz.de/10013141652
Motivated by the Chinese experience, we analyze a semi-open economy where the central bank has access to international capital markets, but the private sector has not. This enables the central bank to choose an interest rate different from the international rate. We examine the optimal policy of...
Persistent link: https://www.econbiz.de/10013097636
a solution to the monetary trilemma with which the central bank can perform its monetary policy independently of foreign …
Persistent link: https://www.econbiz.de/10014346507
Persistent link: https://www.econbiz.de/10013262740
In this paper, we consider an alternative perspective to China's exchange rate policy. We study a semi-open economy where the private sector has no access to international capital markets but the central bank has full access. Moreover, we assume limited financial development generating a large...
Persistent link: https://www.econbiz.de/10010200010