| Description |
1 online resource (35 pages) |
| Series |
IMF working paper, 1018-5941 ; WP/15/284 |
|
IMF working paper ; WP/15/284.
|
| Contents |
Cover; Floating with a Load of FX Debt?; Abstract; I. INTRODUCTION; II. STYLIZED FACTS ABOUT FX EXPOSURES; III. EMPIRICAL METHODOLOGY; IV. RESULTS; V. ROBUSTNESS AND EXTENSIONS; VI. CONCLUSION; VII. REFERENCES; VIII. APPENDIX: COUNTRIES IN A SAMPLE AND DATA SOURCES; IX. APPENDIX: SUMMARY STATISTICS; X. APPENDIX: REGRESSION OUTPUTS |
| Summary |
"Countries with de jure floating exchange rate regimes are often reluctant to allow their currencies to float freely in practice. One reason why countries may wish to limit exchange rate volatility is potential negative balance sheet effects due to currency mismatches on the balance sheets of firms and households. In this paper, the authors show in a sample of 15 emerging market economies that countries with large foreign exchange (FX) debt in the non-financial private sector tend to react more strongly to exchange rate changes using both FX interventions and monetary policy. Thus, our results support the idea that an important source of 'fear of floating' is balance sheet currency mismatches. This effect is asymmetric; that is, countries stem depreciation but not appreciation pressure. Moreover, FX debt financed through the domestic banking system is more important for fear of floating than FX debt obtained directly from external sources."--Abstract |
| Notes |
"December 2015." |
| Subject |
Foreign exchange administration -- Government policy
|
|
Monetary policy.
|
|
Foreign exchange rates.
|
|
Foreign exchange rates
|
|
Monetary policy
|
| Form |
Electronic book
|
| Author |
Mikkelsen, Uffe, author.
|
|
International Monetary Fund. European Department.
|
| ISBN |
1513574140 |
|
9781513574141 |
|
151354330X |
|
9781513543307 |
|
1498309429 |
|
9781498309424 |
|
