This paper proposes a new taxonomy of Sudden Stops comprised of seven categories with definitions depending on the behavior of gross and net capital flows. The incidence of different types of Sudden Stops is tracked over time and the type of Sudden Stop related to economic performance. Sudden...

As the recent crisis has forcefully suggested, understanding financial-market interconnectedness is of a paramount importance to explain systemic risk, stability and economic dynamics. In this paper, we address these issues along two related perspectives. First, we explore the statistical...

This paper provides a comprehensive analysis of the role that financial constraints play in shaping firms' export activities. We use custom information on cross borders transactions for Italian firms, together with an informative measure of financing constraints based on an official credit...

We provide empirical evidence that US financial stress shocks (US-FSSs) are an important driver for economic dynamics and fluctuations in emerging market economies (EMEs). Applying a structural vector autoregression, we analyze the international transmission of US-FSSs to eight EMEs using...

This study argues that trade policies regarding financial services are an important - but typically neglected - determinant of capital flows and financial sector stability. Financial services trade liberalisation which promotes the use of a broad spectrum of financial instruments and allows the...

This paper aims to estimate the equilibrium real exchange rate for the United States economy. The equilibrium exchange rate is defined as the level of exchange that guarantees that the net foreign asset position is stable over time. An econometric model is estimated using multivariate and...

This paper aims to estimate the equilibrium real exchange rate for the Brazilian economy. The equilibrium exchange rate is defined as the level of exchange that guarantees that the net foreign asset position is stable over time. An econometric model is estimated using cointegration techniques....

This paper aims to evaluate what are the main long run determinants of Chinese real exchange rate that have depreciated substantially compared to a basket of currencies. The Chinese government started a process of accumulating foreign reserve in growing speed measured in absolute or relative...

The key dynamics of the transatlantic banking crisis are analyzed - with emphasis on the fact that the banking disaster of 2007/08 was not really a surprise -, and the five key requirements for restoring stability and efficiency in the EU/OECD banking sector are highlighted. Most important,...

This paper presents a model comparing the optimal degree of asset class diversification abroad by a central bank and a sovereign wealth fund. We show that if the central bank manages its foreign asset holdings in order to meet balance of payments needs, particularly in reducing the probability...