Download or read book Portfolio Inflows and Real Effective Exchange Rates written by Rasmané Ouedraogo and published by International Monetary Fund. This book was released on 2017-05-22 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: It has been well-established in the literature that portfolio inflows appreciate the real effective exchange rate. However, the literature lacks a systematic empirical analysis of the impact of portfolio inflows by institutional sector or borrower type. This paper fills this gap by exploring the impact of the inflows of portfolio capital into three institutional sectors (government, banks and corporates) on the real effective exchange rate. Using a large sample of 73 countries, it shows that the effect of portfolio inflows on the real effective exchange rate depends on the sector the investment flows in. The findings are robust to different econometric methods, additional variables in the model, and various indicators of real effective exchange rates.
Download or read book Capital Flows Exchange Rate Flexibility and the Real Exchange Rate written by Mr.Tidiane Kinda and published by International Monetary Fund. This book was released on 2011-01-01 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper analyzes the impact of capital inflows and exchange rate flexibility on the real exchange rate in developing countries based on panel cointegration techniques. The results show that public and private flows are associated with a real exchange rate appreciation. Among private flows, portfolio investment has the highest appreciation effect-almost seven times that of foreign direct investment or bank loans-and private transfers have the lowest effect. Using a de facto measure of exchange rate flexibility, we find that a more flexible exchange rate helps to dampen appreciation of the real exchange rate stemming from capital inflows.
Download or read book The Impact of Capital and Foreign Exchange Flowson the Competitiveness of Developing Countries written by Mr.Bassem Kamar and published by International Monetary Fund. This book was released on 2010-07-01 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: Attracting capital and foreign exchange flows is crucial for developing countries. Yet, these flows could lead to real exchange rate appreciation and may thus have detrimental effects on competitiveness, jeopardizing exports and growth. This paper investigates this dilemma by comparing the impact of six types of capital and foreign exchange flows on real exchange rate behavior in a sample of 57 developing countries covering Africa, Europe, Asia, Latin America, and the Middle East. The results reveal that portfolio investments, foreign borrowing, aid, and income lead to real exchange rate appreciation, while remittances have disparate effects across regions. Foreign direct investments have no effect on the real exchange rate, contributing to resolve the above dilemma.
Download or read book Portfolio Inflows and Real Effective Exchange Rates written by Rasmané Ouedraogo and published by International Monetary Fund. This book was released on 2017-05-22 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: It has been well-established in the literature that portfolio inflows appreciate the real effective exchange rate. However, the literature lacks a systematic empirical analysis of the impact of portfolio inflows by institutional sector or borrower type. This paper fills this gap by exploring the impact of the inflows of portfolio capital into three institutional sectors (government, banks and corporates) on the real effective exchange rate. Using a large sample of 73 countries, it shows that the effect of portfolio inflows on the real effective exchange rate depends on the sector the investment flows in. The findings are robust to different econometric methods, additional variables in the model, and various indicators of real effective exchange rates.
Download or read book The Impact of Capital and Foreign Exchange Flowson the Competitiveness of Developing Countries written by Bassem Kamar and published by International Monetary Fund. This book was released on 2010-07-01 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt: Attracting capital and foreign exchange flows is crucial for developing countries. Yet, these flows could lead to real exchange rate appreciation and may thus have detrimental effects on competitiveness, jeopardizing exports and growth. This paper investigates this dilemma by comparing the impact of six types of capital and foreign exchange flows on real exchange rate behavior in a sample of 57 developing countries covering Africa, Europe, Asia, Latin America, and the Middle East. The results reveal that portfolio investments, foreign borrowing, aid, and income lead to real exchange rate appreciation, while remittances have disparate effects across regions. Foreign direct investments have no effect on the real exchange rate, contributing to resolve the above dilemma.
Download or read book Three Essays on Capital Flows Banking Weakness and Real Exchange Rates in East Asia and Latin America written by Mohamed Hassan and published by . This book was released on 2002 with total page 146 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Capital Flows and Their Macroeconomic Effects in India written by Renu Kohli and published by International Monetary Fund. This book was released on 2001 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book What Flows Around Comes Around written by Florian Mair and published by . This book was released on 2019 with total page 43 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper investigates mean reversion properties of real effective exchange rates (REERs) using a semi-parametric quantile autoregression approach. This method accounts for non-normality and captures asymmetric and dynamic adjustments towards the REER's long run equilibrium, conditional on the size of the shock to the REER. Due to our tests' nonstandard limiting distribution, we apply a resampling procedure for robust inference. Using a sample of 29 countries over the period 1980-2017, we indeed show that the REER features non-linear mean-reverting tendencies following large shocks. The REER adjusts dynamically and asymmetrically towards its long run equilibrium, conditional on the size of the shock. We find half lives of less than one year in some cases for the most extreme quantiles. Additionally, panel regressions indicate that this behavior can be explained by portfolio flows. Large deviations in the REER from its long run mean are followed by debt portfolio flows from international investors. These flows are associated with an appreciation in the REER, conditional on the level of deviation and the shocks incurred, leading to faster mean reversion in REERs. In the most extreme quantile, the flows move the REER back towards its mean by 1.78% per month.
Download or read book Real Exchange Rates Economic Complexity and Investment written by Steve Brito and published by International Monetary Fund. This book was released on 2018-05-10 with total page 21 pages. Available in PDF, EPUB and Kindle. Book excerpt: We show that the response of firm-level investment to real exchange rate movements varies depending on the production structure of the economy. Firms in advanced economies and in emerging Asia increase investment when the domestic currency weakens, in line with the traditional Mundell-Fleming model. However, in other emerging market and developing economies, as well as some advanced economies with a low degree of structural economic complexity, corporate investment increases when the domestic currency strengthens. This result is consistent with Diaz Alejandro (1963)—in economies where capital goods are mostly imported, a stronger real exchange rate reduces investment costs for domestic firms.
Download or read book Prediction and Causality in Econometrics and Related Topics written by Nguyen Ngoc Thach and published by Springer Nature. This book was released on 2021-07-26 with total page 691 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book provides the ultimate goal of economic studies to predict how the economy develops—and what will happen if we implement different policies. To be able to do that, we need to have a good understanding of what causes what in economics. Prediction and causality in economics are the main topics of this book's chapters; they use both more traditional and more innovative techniques—including quantum ideas -- to make predictions about the world economy (international trade, exchange rates), about a country's economy (gross domestic product, stock index, inflation rate), and about individual enterprises, banks, and micro-finance institutions: their future performance (including the risk of bankruptcy), their stock prices, and their liquidity. Several papers study how COVID-19 has influenced the world economy. This book helps practitioners and researchers to learn more about prediction and causality in economics -- and to further develop this important research direction.
Download or read book International Portfolio Flows and Exchange Rate Volatility for Emerging Markets written by Guglielmo Maria Caporale and published by . This book was released on 2015 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Capital Inflows and Real Exchange Rate Appreciation in Latin America written by Guillermo A. Calvo and published by . This book was released on 1992 with total page 70 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Exchange Rate Volatility and Trade Flows Some New Evidence written by International Monetary Fund and published by International Monetary Fund. This book was released on 2004-05-19 with total page 132 pages. Available in PDF, EPUB and Kindle. Book excerpt: NULL
Download or read book Policy Responses to Capital Flows in Emerging Markets written by Mahmood Pradhan and published by International Monetary Fund. This book was released on 2011-04-20 with total page 45 pages. Available in PDF, EPUB and Kindle. Book excerpt: Staff Discussion Notes showcase the latest policy-related analysis and research being developed by individual IMF staff and are published to elicit comment and to further debate. These papers are generally brief and written in nontechnical language, and so are aimed at a broad audience interested in economic policy issues. This Web-only series replaced Staff Position Notes in January 2011.
Download or read book Cross Country Heterogeneous and Time Varying Effects of Unconventional Monetary Policies in AEs on Portfolio Inflows to EMEs written by Kyoungsoo Yoon and published by . This book was released on 2015 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines cross-country heterogeneity and time-variability in the effects of unconventional monetary policies (UMPs) in advanced economies (AEs) on portfolio inflows to emerging economies (EMEs), with a panel smooth transition regression model. The drivers of the two dimensional nonlinearities are country-specific factors such as the current account, real effective exchange rate deviation from its historical average, and foreign exchange reserves. The elasticity of portfolio inflows to EMEs with respect to a direct quantitative measure of UMP, growth in the Fed's security assets, tends to be higher with a higher current account, higher exchange rate appreciation expectations, and greater foreign exchange reserve holdings, while the results are the opposite with a price measure of UMP, a change in the US 10-year Treasury yield. These results imply that a price UMP shock from news about or impending QE tapering would more adversely affect an EME with a weaker external sector. If QE tapering is actually implemented with clearer signs of economic recovery in AEs, the increase in global liquidity due to AE recoveries will help EMEs muddle relatively easily through the quantitative shock from the reduction in the Fed's security assets.
Download or read book The Fundamental Determinants of the Real Exchange Rate of the U S Dollar Relative to Other G 7 Currencies written by Mr.Jerome L. Stein and published by International Monetary Fund. This book was released on 1995-08-01 with total page 46 pages. Available in PDF, EPUB and Kindle. Book excerpt: The IMF Working Papers series is designed to make IMF staff research available to a wide audience. Almost 300 Working Papers are released each year, covering a wide range of theoretical and analytical topics, including balance of payments, monetary and fiscal issues, global liquidity, and national and international economic developments.
Download or read book Foreign Currency Bank Funding and Global Factors written by Signe Krogstrup and published by International Monetary Fund. This book was released on 2018-05-09 with total page 64 pages. Available in PDF, EPUB and Kindle. Book excerpt: The literature on the drivers of capital flows stresses the prominent role of global financial factors. Recent empirical work, however, highlights how this role varies across countries and time, and this heterogeneity is not well understood. We revisit this question by focusing on financial intermediaries’ funding flows in different currencies. A concise portfolio model shows that the sign and magnitude of the response of foreign currency funding flows to global risk factors depend on the financial intermediary’s pre-existing currency exposure. An analysis of a rich dataset of European banks’ aggregate balance sheets lends support to the model predictions, especially in countries outside the euro area.
