Official holdings of US dollar reserves are partly invested outside the United States. These offshore investments do not strictly speaking finance the US current account, but do support the US dollar. Offshore holdings grow fast when intervention is large

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...

A long-standing puzzle in international finance is the durability of the dollar's share of foreign exchange reserves - which remains above 60%, while the weight of the US economy in global output has fallen to less than a quarter. We argue that the dollar's role may reflect instead the share of...

This paper presents a new concept - the global roles of currencies. The concept combines the domestic and international (cross-border) use of currencies and therefore captures the overall importance of different currencies in a globalised economy. The measure of a currency's global role is based...

Rumors about the actual or potential currency diversification of countries' foreign exchange holdings out of dollars are not a new phenomenon. This working paper argues that such concerns about reserve diversification are exaggerated. We present evidence that the extent of actual diversification...

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...

This paper employs the GMM estimator to empirically investigate the effects of Japanese international reserves on Yen internationalization from 1976 through 2009 by specifying the regression benchmark based on the long-run determinants of Yen internationalization with economic power, Yen...

内容提要: 本文采用GMM 估计方法，根据影响日元国际化的长期决定因素( 经济实力、金融市场发展、货币汇率升值、通货膨胀和货币惯性) 设定回归基准模型，对1976—2009...

We investigate the effects of Central Bank interventions which are designed to smooth exchange rate volatility but are not aimed at a particular trend level. We present a model in which the intervention flow is a non-linear mapping of the market order flow. Simulations show that small daily...

While virtually all modern models of exchange rate crises recognise that the decision to abandon an exchange rate peg depends on how harshly policy makers are willing to defend the regime, they virtually never model how the exchange rate is defended. In this paper we incorporate both the...