Inflation Targeting and Exchange Rate Volatility in Emerging Markets

The paper investigates the relevance of the exchange rate on the reaction function of the central banks of 24 emerging market economies for the period 2000Q1 to 2015Q2. This is done by first employing fixed-effects ordinary least squares and then s...

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Bibliographic Details
Main Authors:	Cabral, Rene, Carneiro, Francisco G., Varella Mollick, Andre
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2016
Subjects:	GLOBAL FINANCIAL STABILITY MONETARY POLICY CONSUMPTION EXPENDITURES MARKET COUNTRIES DISCRETIONARY POLICIES ECONOMIC GROWTH CHECKS MONEY SUPPLIES REAL INTEREST RATES INTEREST MACROECONOMIC MANAGEMENT REAL EXCHANGE RATES ASSET PRICES DEBT CRISIS CREDIBILITY PROBLEMS EMERGING ECONOMIES INTEREST RATE PRIVATE CREDIT OPTION EXCHANGE MACROECONOMIC POLICY REAL INTEREST INTEREST RATE POLICY INFLATION TARGETING DOMESTIC INTEREST RATES HIGH INFLATION DISCOUNT CENTRAL BANK INDEPENDENCE ASSET POSITIONS DUMMY VARIABLE RESERVE CENTRAL BANKS INFLATION INTERNATIONAL BANK INSTRUMENTS EMERGING MARKET ECONOMIES CREDIBILITY BANK LENDING CENTRAL BANK INTEREST-RATE EMERGING MARKET COUNTRIES INTERNATIONAL FINANCE POLICY RESPONSE EXCHANGE RATE MECHANISMS REJECTION T-BILL RATES CURRENCY EXCHANGE RATE MOVEMENTS RESERVE BANK HOME CURRENCY EXCHANGE RATES INTEREST RATES MONETARY FUND FLEXIBLE EXCHANGE RATE GLOBALIZATION EMERGING MARKET MONETARY TRANSMISSION MARKETS DEBT INFLATION RATE OPEN ECONOMY BUSINESS CYCLE INTERNATIONAL ECONOMICS MACROECONOMIC INDICATORS GROSS DOMESTIC PRODUCT FINANCIAL SYSTEM MONETARY AUTHORITIES COMMODITY PRICE FINANCE FOREIGN CURRENCY BANK POLICY MARKET ECONOMIES FLOATING EXCHANGE RATE INTEREST PARITY EMERGING MARKETS EQUITY INTEREST RATE CHANGES FEDERAL RESERVE FORWARD MARKET INTERNATIONAL FINANCIAL STATISTICS TRANSPARENCY FINANCIAL STABILITY PRIVATE SECTOR CREDIT FINANCIAL CRISIS CURRENCY CRISIS WORLD ECONOMY OUTPUT GAP PRICE STABILITY EXPENDITURES ECONOMY CAPITAL FLOWS PROPERTY PRICE FLUCTUATIONS T-BILL REAL EXCHANGE RATE MARKET FOREIGN EXCHANGE PRICE MOVEMENTS FIXED EFFECTS INFLATION RATES BUSINESS CYCLES CURRENCIES CENTRAL BANK POLICY GOODS EXCHANGE RATE VOLATILITY EQUITY MARKETS INVESTMENT MACROECONOMIC VOLATILITY RISK BOND GROWTH PERFORMANCE INFLATION OBJECTIVES FOREIGN INTEREST FINANCIAL MARKETS CAPITAL INFLOWS MONEY MARKET CONSUMER PRICE INDEX LENDING TRANSITION ECONOMIES EXCHANGE RATE INSTRUMENT ROBUSTNESS CHECKS STABLE INFLATION LIABILITIES OPEN ECONOMIES MACROECONOMIC PERFORMANCE ASSET PRICE ECONOMIES INTEREST RATE DIFFERENTIALS INVESTMENT DECISION
Online Access:	http://documents.worldbank.org/curated/en/2016/06/26507283/inflation-targeting-exchange-rate-volatility-emerging-markets http://hdl.handle.net/10986/24629

Internet

http://documents.worldbank.org/curated/en/2016/06/26507283/inflation-targeting-exchange-rate-volatility-emerging-markets
http://hdl.handle.net/10986/24629

Inflation Targeting and Exchange Rate Volatility in Emerging Markets

Internet

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