Download or read book Policies for Developing Foreign Exchange Markets Occ Paper No 60 written by International Monetary Fund and published by International Monetary Fund. This book was released on 1988-06-16 with total page 66 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper describes and analyzes forward market systems with varying degrees of sophistication, and it assesses them from the viewpoint of a smaller industrial or developing country asking itself how it could institute such a system, or how it could further develop an existing system in a way consistent with its institutional and macroeconomic structure. All industrial countries except Iceland now have forward exchange markets in which the rate is determined by the market. Forward markets that have been liberalized in several countries in the 1980s have matured quickly. There are several variants of market-determined systems which could be envisaged. An auction market could be devised for forward transactions, but is unlikely to be practical, because the supply of forward exchange probably may not be determined in advance sufficiently accurately. As the last stage of its development, the market could be extended from underlying commercial transactions to forward transactions of a purely financial character, a process that is taking place in most of the few industrial countries that have retained regulated forward systems. Development of a forward market is not a panacea for incorrect financial policies. In fact, cultivation of the market will require the adoption and maintenance of realistic financial policies.
Download or read book Policies for Developing Forward Foreign Exchange Markets written by International Monetary Fund and published by . This book was released on 1986 with total page 51 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Stabilization Policies in Developing Countries with a Parallel Market for Foreign Exchange written by Pierre-Richard Agénor and published by International Monetary Fund. This book was released on 1990-03-01 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: The paper develops and tests a model of a developing economy that incorporates trade and capital restrictions, illegal transactions, a parallel foreign exchange market, currency substitution features, and forward-looking rational expectations. Temporary expansionary demand policies are associated with an increase in output and prices, a fall in the stock of net foreign assets, and a depreciation of the parallel exchange rate. The speed of adjustment is inversely related to the degree of rationing in the official foreign currency market. A once-for–all devaluation of the official exchange rate has no long-term effect on the premium.
Download or read book Policies for Developing Forward Foreign Exchange Markets written by Peter J. Quirk and published by . This book was released on 1988 with total page 51 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Official Foreign Exchange Intervention written by Mr.Jorge Iván Canales Kriljenko and published by International Monetary Fund. This book was released on 2006-03-02 with total page 58 pages. Available in PDF, EPUB and Kindle. Book excerpt: Despite increasing exchange rate flexibility, central banks in emerging markets still intervene in their foreign exchange markets for several reasons. In doing so, they face many operational questions, including on the degree of transparency and the choice of markets and counterparties. This paper identifies elements of best practice in official foreign exchange intervention, presents survey evidence on intervention practices in developing countries, and assesses the effectiveness of intervention in Mexico and Turkey.
Download or read book Official Intervention in the Foreign Exchange Market written by Roberto Pereira Guimarães and published by International Monetary Fund. This book was released on 2003-07-01 with total page 45 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper offers guidance on the operational aspects of official intervention in the foreign exchange market, particularly in developing countries with flexible exchange rate regimes. A brief survey of the literature and country experience is followed by an analysis of the objectives, timing, amount, degree of transparency, and choice of markets and counterparties in conducting intervention. The analysis highlights the difficulty of detecting exchange rate misalignments and disorderly markets, and argues in favor of parsimony in official intervention. Determining the timing and amount of intervention is a highly subjective excercise, and some degree of discretion is almost necessary, though policy rules may serve as "rules of thumb."
Download or read book The Forward Market in Foreign Exchange written by Brendan Brown and published by Routledge. This book was released on 2017-04-21 with total page 158 pages. Available in PDF, EPUB and Kindle. Book excerpt: Originally published in 1983. With the prevailing uncertainties and wild fluctuation in exchange values at the time, the forward market in foreign exchange had become a vital issue for both governments and business corporations. This book by an expert practitioner in foreign exchange dealing describes how the forward market functions and analyses the constituent elements in its behaviour. The two principal types of foreign exchange deal are examined; forward outright and swap, and explanations are given of how both operate. The linkage between forward rates and interest rates is also considered and the book investigates what factors cause deviation from parity conditions. In addition, there is a discussion of political risk and the forward contract and the role of speculation in forward exchange as well as the methods of hedging.
Download or read book Stabilization Policies in Developing Countries with a Parallel Market for Foreign Exchange written by Pierre-Richard Agenor and published by . This book was released on 2006 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: The paper develops and tests a model of a developing economy that incorporates trade and capital restrictions, illegal transactions, a parallel foreign exchange market, currency substitution features, and forward-looking rational expectations. Temporary expansionary demand policies are associated with an increase in output and prices, a fall in the stock of net foreign assets, and a depreciation of the parallel exchange rate. The speed of adjustment is inversely related to the degree of rationing in the official foreign currency market. A once-forᔚll devaluation of the official exchange rate has no long-term effect on the premium.
Download or read book Foreign Exchange Risk Regulation written by Mr.Philipp Hartmann and published by International Monetary Fund. This book was released on 1994-12-01 with total page 54 pages. Available in PDF, EPUB and Kindle. Book excerpt: Capital adequacy regulations or quantity restrictions on bank portfolios put forward by the Basle Committee on Banking Supervision have virtually become an international standard of prudential regulation. Recent proposals aim at extending this approach to market risks, in particular to foreign exchange risk. The present paper provides a critical analysis of proposals to introduce foreign exchange position limits on a uniform cross-country basis, focusing on their effectiveness and their possible impact on the functioning of both mature and developing foreign exchange markets. Theoretical considerations are underpinned in the paper with descriptions of existing or proposed regulations, in a broad range of both industrial and developing countries. Experiences with the use of foreign exchange position limits in developing countries provide insight into their widespread use for other than prudential purposes, in particular to support exchange rate and exchange control policies.
Download or read book Foreign Exchange Intervention Rules for Central Banks A Risk based Framework written by Romain Lafarguette and published by International Monetary Fund. This book was released on 2021-02-12 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper presents a rule for foreign exchange interventions (FXI), designed to preserve financial stability in floating exchange rate arrangements. The FXI rule addresses a market failure: the absence of hedging solution for tail exchange rate risk in the market (i.e. high volatility). Market impairment or overshoot of exchange rate between two equilibria could generate high volatility and threaten financial stability due to unhedged exposure to exchange rate risk in the economy. The rule uses the concept of Value at Risk (VaR) to define FXI triggers. While it provides to the market a hedge against tail risk, the rule allows the exchange rate to smoothly adjust to new equilibria. In addition, the rule is budget neutral over the medium term, encourages a prudent risk management in the market, and is more resilient to speculative attacks than other rules, such as fixed-volatility rules. The empirical methodology is backtested on Banco Mexico’s FXIs data between 2008 and 2016.
Download or read book Issues of Openness and Flexibility for Foreign Exchange Systems written by International Monetary Fund and published by International Monetary Fund. This book was released on 1989-01-01 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper surveys briefly the main issues for official management of foreign exchange, including the choice of exchange rate regime and exchange and trade restrictive systems. It concludes by identifying the main forms of arrangements that have demonstrated their merits and practicability for developing countries in recent years, including auction and interbank exchange markets, market-based forward exchange rates, import license auctions, open general import licensing, and liberalized capital controls.
Download or read book Moving to a Flexible Exchange Rate written by Mrs.Gilda Fernandez and published by International Monetary Fund. This book was released on 2006-01-09 with total page 29 pages. Available in PDF, EPUB and Kindle. Book excerpt: A growing number of countries are adopting flexible exchange rate regimes because flexibility offers more protection against external shocks and greater monetary independence. Other countries have made the transition under disorderly conditions, with the sharp depreciation of their currency during a crisis. Regardless of the reason for adopting a flexible exchange rate, a successful transition depends on the effective management of a number of institutional and operational issues. The authors of this Economic Issue describe the necessary ingredients for moving to a flexible regime, as well as the optimal pace and sequencing under different conditions.
Download or read book Foreign Exchange Market Organization in Selected Developing and Transition Economies written by Jorge Iván Canales Kriljenko and published by International Monetary Fund. This book was released on 2004 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: The foreign exchange market microstructures in developing and transition economies are characterized by the results from the IMF's 2001 Survey on Foreign Exchange Market Organization. The survey found that these markets are usually unified onshore spot markets for U.S. dollars, where transactions are concentrated at the bank-customer level. The trading mechanisms are usually dealer or mixed dealer/auction markets; the degree of transparency is often low; settlement systems remain risky; and the scope for price discovery is variable.
Download or read book From Fixed to Float written by Mrs.Gilda Fernandez and published by International Monetary Fund. This book was released on 2004-07-01 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper identifies the institutional and operational requisites for transitions to floating exchange rate regimes. In particular, it explores key issues underlying the transition, including developing a deep and liquid foreign exchange market, formulating intervention policies consistent with the new regime, establishing an alternative nominal anchor in the context of a new monetary policy framework, and building the capacity of market participants to manage exchange rate risks and of supervisory authorities to regulate and monitor them. It also assesses the factors that influence the pace of exit and the appropriate sequencing of exchange rate flexibility and capital account liberalization.
Download or read book An Empirical Study of the Foreign exchange Market Test of a Theory written by Fred R. Glahe and published by . This book was released on 1967 with total page 76 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Exchange Policies for Less Developed Countries in a World of Floating Rates written by Stanley W. Black and published by Princeton, N.J. : International Finance Section, Department of Economics, Princeton University. This book was released on 1976 with total page 60 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Management of Foreign Exchange written by Raj Aggarwal and published by Ayer Publishing. This book was released on 1980-01-01 with total page 154 pages. Available in PDF, EPUB and Kindle. Book excerpt:
