Search Results
Working Paper
How successful is the G7 in managing exchange rates?
Fratzscher, Marcel
(2009)
The paper assesses the extent to which the Group of Seven (G7) has been successful in its management of major currencies since the 1970s. Using an event-study approach, the paper finds evidence that the G7 has been overall effective in moving the U.S. dollar, yen and euro in the intended direction at horizons of up to three months after G7 meetings, but not at longer horizons. While the success of the G7 is partly dependent on the market environment, it is also to a significant degree endogenous to the policy process itself. The findings indicate that the reputation and credibility of the G7, ...
Globalization Institute Working Papers
, Paper 24
Working Paper
Optimal monetary policy in a currency union with interest rate spreads
Lee, Jae Won; Bhattarai, Saroj; Park, Woong Yong
(2013)
We introduce ?financial imperfections? - asymmetric net wealth positions, incomplete risksharing, and interest rate spread across member countries - in a prototypical two-country currency union model and study implications for monetary policy transmission mechanism and optimal policy. In addition to, and independent from, the standard transmission mechanism associated with nominal rigidities, financial imperfections introduce a wealth redistribution role for monetary policy. Moreover, the two mechanisms reinforce each other and amplify the effects of monetary policy. On the normative side, ...
Globalization Institute Working Papers
, Paper 150
Working Paper
The Prudential Use of Capital Controls and Foreign Currency Reserves
Bianchi, Javier; Lorenzoni, Guido
(2021-11-12)
We provide a simple framework to study the prudential use of capital controls and currency reserves that have been explored in the recent literature. We cover the role of both pecuniary externalities and aggregate demand externalities. The model features a central policy dilemma for emerging economies facing large capital outflows: the choice between increasing the policy rate to stabilize the exchange rate and decreasing the policy rate to stabilize employment. Ex ante capital controls and reserve accumulation can help mitigate this dilemma. We use our framework to survey the recent ...
Working Papers
, Paper 787
Report
Drivers of Dollar Share in Foreign Exchange Reserves
Hannaoui, Oliver Zain; Goldberg, Linda S.
(2024-03-01)
The share of U.S. dollar assets in the official foreign exchange reserve portfolios of central banks, at times, is taken as an indicator of dollar status. We show that the observed decline in aggregate U.S. dollar shares is not from a systematic decline in preferences for dollar assets. Instead, it is explained by a small group of countries, both due to monetary policies executed vis-à-vis euros and due to a small group of large foreign exchange reserve balance countries. Regression analysis shows that relative interest rates of reserve currencies and nontraditional currencies can tilt ...
Staff Reports
, Paper 1087
Working Paper
Federal Reserve policy and Bretton Woods
Humpage, Owen F.; Bordo, Michael D.
(2014-10-01)
During the Bretton Woods era, balance-of-payments developments, gold losses, and exchange-rate concerns had little influence on Federal Reserve monetary policy, even after 1958 when such issues became critical. The Federal Reserve could largely disregard international considerations because the U.S. Treasury instituted a number of stopgap devices?the gold pool, the general agreement to borrow, capital restraints, sterilized foreign-exchange operations?to shore up the dollar and Bretton Woods. These, however, gave Federal Reserve policymakers the latitude to focus on the domestic objectives ...
Globalization Institute Working Papers
, Paper 206
Working Paper
Federal Reserve Policy and Bretton Woods
Humpage, Owen F.; Bordo, Michael D.
(2014-08-27)
During the Bretton Woods era, balance-of-payments developments, gold losses, and exchange rate concerns had little influence on Federal Reserve monetary policy, even after 1958 when such issues became critical. The Federal Reserve could largely disregard international considerations because the U.S. Treasury instituted a number of stop-gap devices?the gold pool, the general agreement to borrow, capital restraints, sterilized foreign-exchange operations?to shore up the dollar and Bretton Woods. These, however, gave Federal Reserve policymakers the latitude to focus on domestic objectives and ...
Working Papers (Old Series)
, Paper 1407
Working Paper
The Federal Reserve engages the world (1970-2000): an insider's narrative of the transition to managed floating and financial turbulence
Truman, Edwin M.
(2014-10-01)
This paper traces the evolution of the Federal Reserve and its engagement with the global economy over the last three decades of the 20th century: 1970 to 2000. The paper examines the Federal Reserve?s role in international economic and financial policy and analysis covering four areas: the emergence and taming of the great inflation, developments in US external accounts, foreign exchange analysis and activities, and external financial crises. It concludes that during this period the US central bank emerged to become the closest the world has to a global central bank.
Globalization Institute Working Papers
, Paper 210
Working Paper
A Theory of Fear of Floating
Bianchi, Javier; Coulibaly, Louphou
(2023-02-03)
Many central banks whose exchange rate regimes are classified as flexible are reluctant to let the exchange rate fluctuate. This phenomenon is known as “fear of floating”. We present a simple theory in which fear of floating emerges as an optimal policy outcome. The key feature of the model is an occasionally binding borrowing constraint linked to the exchange rate that introduces a feedback loop between aggregate demand and credit conditions. Contrary to the Mundellian paradigm, we show that a depreciation can be contractionary, and letting the exchange rate float can expose the economy ...
Working Papers
, Paper 796
Working Paper
Global Financial Cycles and Risk Premiums
Jordà, Òscar; Ward, Felix; Taylor, Alan M.; Schularick, Moritz
(2018-06-11)
This paper studies the synchronization of financial cycles across 17 advanced economies over the past 150 years. The comovement in credit, house prices, and equity prices has reached historical highs in the past three decades. The sharp increase in the comovement of global equity markets is particularly notable. We demonstrate that fluctuations in risk premiums, and not risk-free rates and dividends, account for a large part of the observed equity price synchronization after 1990. We also show that U.S. monetary policy has come to play an important role as a source of fluctuations in risk ...
Working Paper Series
, Paper 2018-5
Working Paper
The Global Factor in Neutral Policy Rates : Some Implications for Exchange Rates, Monetary Policy, and Policy Coordination
Clarida, Richard H.
(2019-04-22)
This paper highlights some of the theoretical and practical implications for monetary policy and exchange rates that derive specifically from the presence of a global general equilibrium factor embedded in neutral real policy rates in open economies. Using a standard two country DSGE model, we derive a structural decomposition in which the nominal exchange rate is a function of the expected present value of future neutral real interest rate differentials plus a business cycle factor and a PPP factor. Country specific ?r*? shocks in general require optimal monetary policy to pass these through ...
International Finance Discussion Papers
, Paper 1244
FILTER BY year
FILTER BY Bank
Federal Reserve Bank of Dallas 10 items
Federal Reserve Bank of San Francisco 10 items
Federal Reserve Bank of Atlanta 8 items
Board of Governors of the Federal Reserve System (U.S.) 7 items
Federal Reserve Bank of New York 7 items
Federal Reserve Bank of St. Louis 4 items
Federal Reserve Bank of Minneapolis 3 items
Federal Reserve Bank of Boston 1 items
Federal Reserve Bank of Cleveland 1 items
show more (4)
show less
FILTER BY Series
Globalization Institute Working Papers 10 items
Working Paper Series 9 items
Working Papers 6 items
Staff Reports 5 items
Policy Hub 4 items
FRB Atlanta Working Paper 3 items
Finance and Economics Discussion Series 3 items
Federal Reserve Bulletin 2 items
International Finance Discussion Papers 2 items
Current Issues in Economics and Finance 1 items
Current Policy Perspectives 1 items
Economic Policy Review 1 items
Policy Hub* 1 items
Proceedings 1 items
Staff Report 1 items
Working Papers (Old Series) 1 items
show more (11)
show less
FILTER BY Content Type
Working Paper 34 items
Journal Article 8 items
Report 7 items
Conference Paper 1 items
Discussion Paper 1 items
FILTER BY Author
Jordà, Òscar 5 items
Ohanian, Lee E. 4 items
Restrepo-Echavarria, Paulina 4 items
Van Patten, Diana 4 items
Wright, Mark L. J. 4 items
Goldberg, Linda S. 3 items
Taylor, Alan M. 3 items
Wall, Larry D. 3 items
Bianchi, Javier 2 items
Bordo, Michael D. 2 items
Choi, Mark 2 items
Erce, Aitor 2 items
Gilchrist, Simon 2 items
Glick, Reuven 2 items
Humpage, Owen F. 2 items
Lerman, Robert 2 items
Nechio, Fernanda 2 items
Rose, Andrew K. 2 items
Schularick, Moritz 2 items
Wei, Bin 2 items
Yue, Vivian Z. 2 items
Zakrajšek, Egon 2 items
Benedict, Craig 1 items
Bhattarai, Saroj 1 items
Broda, Christian 1 items
Caramichael, John 1 items
Cheng, Gong 1 items
Clarida, Richard H. 1 items
Clark, John 1 items
Cooper, Russell W. 1 items
Coulibaly, Louphou 1 items
Crosignani, Matteo 1 items
Crucini, Mario J. 1 items
Diaz-Cassou, Javier 1 items
Fratzscher, Marcel 1 items
Hannaoui, Oliver Zain 1 items
Higgins, Matthew 1 items
Kahn, Robert B. 1 items
Kara, Gazi I. 1 items
Kehoe, Patrick J. 1 items
Kempf, Hubert 1 items
Klitgaard, Thomas 1 items
Kos, Dino 1 items
Lambert, Michael J. 1 items
Landry, Anthony 1 items
Lee, Jae Won 1 items
Liao, Gordon Y. 1 items
Liebmann, Eva 1 items
Liu, Zheng 1 items
Lopez, Jose A. 1 items
Lorenzoni, Guido 1 items
Lucas, Deborah 1 items
Martinez-Garcia, Enrique 1 items
McCauley, Robert N. 1 items
Meade, Ellen E. 1 items
Mitchener, Kris James 1 items
Park, Woong Yong 1 items
Pastorino, Elena 1 items
Peek, Joe 1 items
Peled, Dan 1 items
Pieters, Gina 1 items
Quinn, Stephen F. 1 items
Ravazzolo, Fabiola 1 items
Ravazzolo, Francesco 1 items
Riera-Crichton, Daniel 1 items
Roberds, William 1 items
Singh, Sanjay R. 1 items
Spiegel, Mark M. 1 items
Stanton, Kristin D. 1 items
Tai, Andrew 1 items
Tille, Cedric 1 items
Truman, Edwin M. 1 items
Ward, Felix 1 items
show more (68)
show less
FILTER BY Jel Classification
F31 11 items
F41 11 items
E44 10 items
F36 9 items
F42 9 items
G28 9 items
G15 8 items
E51 6 items
F34 5 items
F38 5 items
F44 5 items
G21 5 items
E01 4 items
E21 4 items
E30 4 items
E32 4 items
E47 4 items
E58 4 items
E65 4 items
F21 4 items
F3 4 items
F32 4 items
G18 4 items
J20 4 items
E50 3 items
E52 3 items
G01 3 items
G12 3 items
G23 3 items
G32 3 items
H12 3 items
H6 3 items
N22 3 items
E31 2 items
E4 2 items
E40 2 items
E42 2 items
E43 2 items
E61 2 items
F15 2 items
F53 2 items
N1 2 items
C30 1 items
E3 1 items
E5 1 items
E59 1 items
E6 1 items
E60 1 items
E63 1 items
F35 1 items
F37 1 items
F40 1 items
F45 1 items
F5 1 items
F50 1 items
F51 1 items
F52 1 items
F55 1 items
G10 1 items
G20 1 items
G33 1 items
H63 1 items
N10 1 items
N13 1 items
N14 1 items
N20 1 items
O16 1 items
O17 1 items
O30 1 items
show more (65)
show less
FILTER BY Keywords
Federal Reserve 7 items
Bretton Woods 5 items
FDIC 3 items
Treasury 3 items
bailout 3 items
business cycle accounting 3 items
capital controls 3 items
capital flows 3 items
dollar 3 items
financial history 3 items
financial stability 3 items
liquidity 3 items
CDS 2 items
Federal Reserve lending facilities 2 items
Foreign exchange rates 2 items
Monetary policy 2 items
eurodollar 2 items
excess bond premium 2 items
exchange rates 2 items
financial crises 2 items
global financial cycle 2 items
global financial risk 2 items
inflation 2 items
international lender of last resort 2 items
monetary policy 2 items
repo 2 items
sovereign bonds 2 items
swap line 2 items
Bank Capital 1 items
Bank Credit 1 items
Banking 1 items
Basel Capital Accord 1 items
CNY 1 items
Capital Flows 1 items
Capital Requirements 1 items
Capital controls 1 items
Central Bank Swap Lines 1 items
Central bank coordination 1 items
Chinese currency 1 items
Chinese yuan 1 items
Credit intermediation 1 items
Cross-country externalities 1 items
Cross-country insurance 1 items
Cross-country transfers 1 items
Digital currencies 1 items
Dollar, American 1 items
Exchange rate 1 items
Exchange rates 1 items
FIMA Repo Facility 1 items
Financial innovation 1 items
Financial regulation 1 items
Fintech 1 items
Fiscal externalities 1 items
Foreign Exchange Reserves 1 items
Global financial institutions 1 items
Government Bonds 1 items
International Payments 1 items
International finance 1 items
International financial markets 1 items
International monetary system 1 items
International policy coordination 1 items
International transfers 1 items
Macroprudential policies 1 items
Money 1 items
Official debt 1 items
Optimal currency area 1 items
Paris Club 1 items
Payment system 1 items
Policy coordination 1 items
Price levels 1 items
Risk-Shifting 1 items
Self-fulfilling financial crises 1 items
Sovereign Crises 1 items
Stablecoins 1 items
Systemic risk 1 items
Target2 1 items
Taylor rule 1 items
U.S. Treasury 1 items
balance of payments crisis 1 items
central banks 1 items
convenience yields 1 items
covid19 1 items
cross-border capital flows 1 items
currency of international debt 1 items
currency policy 1 items
empirical data panel 1 items
equilibrium 1 items
euro area 1 items
exchange rate regimes 1 items
financial 1 items
financial account 1 items
financial development 1 items
fiscal transfers 1 items
flexible exchange rate 1 items
foreign exchange interventions 1 items
foreign exchange reserves 1 items
hard fix 1 items
historical panel data 1 items
hysteresis 1 items
instrumental variables 1 items
international finance 1 items
international risk sharing 1 items
intervention 1 items
local projections 1 items
monetary interventions 1 items
money neutrality 1 items
policy insolvency 1 items
recession 1 items
reserve currency 1 items
sovereign debt restructuring 1 items
target. 1 items
terms of trade 1 items
trilemma 1 items
trilemma mechanism 1 items
wages 1 items
show more (110)
show less