Evolving international financial markets: some implications for Central Banks
AbstractInternationally integrated capital markets can have significant effects on the way central bankers pursue both monetary (macroeconomic) and financial stability. With respect to the former, countries are being pushed into corner solutions of either "immutably" fixed exchange rates or floating. While the proper choice depends on a country's circumstances, no regime is without its own problems. In this paper, some of the practical implications of floating are highlighted; in particular, how adoption of such a regime affects the transmission mechanism of monetary policy and the problems posed by volatile exchange rate expectations. As for the pursuit of financial stability, central bankers and other regulators must increasingly recognise the international dimension in their efforts to promote the health of financial institutions, financial markets and the infrastructure (legal, payment systems, etc.) which supports them. This international dimension affects the nature of the prudential policies adopted as well as the processes through which they are agreed. Finally, recognising that monetary stability and financial stability are two sides of the same coin (witness Mexico in 1995 and South Asia more recently), the paper concludes with some preliminary reflections on possible interactions between monetary and prudential policies in an internationally integrated world.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Bank for International Settlements in its series BIS Working Papers with number 66.
Length: 44 pages
Date of creation: Apr 1999
Date of revision:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Jonung, Lars, 1979. "Knut wicksell's norm of price stabilization and Swedish monetary policy in the 1930's," Journal of Monetary Economics, Elsevier, vol. 5(4), pages 459-496, October.
- Berg, Claes & Jonung, Lars, 1998.
"Pioneering Price Level Targeting: The Swedish Experience 1931-1937,"
642, Stockholm University, Institute for International Economic Studies.
- Berg, Claes & Jonung, Lars, 1999. "Pioneering price level targeting: The Swedish experience 1931-1937," Journal of Monetary Economics, Elsevier, vol. 43(3), pages 525-551, June.
- Berg, Claes & Jonung, Lars, 1998. "Pioneering Price Level Targeting:The Swedish Experience 1931-1937," Working Paper Series in Economics and Finance 290, Stockholm School of Economics.
- Berg, C. & Jonung, L., 1998. "Pioneering Price Level Targeting: The Swedish Experience 1931-1937," Papers 642, Stockholm - International Economic Studies.
- Murray, J. & Van Norden, S. & Vigfusson, R., 1996. "Excess Volatility and Speculative Bubbles in the Canadian Dollar: Real of Imagined?," Technical Reports 76, Bank of Canada.
- Michael D. Bordo & Barry Eichengreen & Jongwoo Kim, 1998. "Was There Really an Earlier Period of International Financial Integration Comparable to Today?," NBER Working Papers 6738, National Bureau of Economic Research, Inc.
- Michael Bruno & William Easterly, 1995.
"Inflation Crises and Long-Run Growth,"
NBER Working Papers
5209, National Bureau of Economic Research, Inc.
- Maurice Obstfeld & Kenneth S. Rogoff, 1996. "Foundations of International Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262150476, December.
- Ghosh, Saibal, 2001. "Financial Stability and Public Policy: An Overview," MPRA Paper 19757, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Timo Laurmaa).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.