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Evolution and Performance of Exchange Rate Regimes

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Author Info

  • Robin Brooks
  • Kenneth Rogoff
  • Ashoka Mody
  • Nienke Oomes
  • Aasim M. Husain

Abstract

The issue of the appropriate exchange rate regime for individual countries has been perennially lively, and the role played by international capital flows and domestic financial systems in determining the performance of these regimes has gained prominence in the policy debate. Using recent advances in the classification of exchange rate regimes, the key message in this paper is that, as economies and their institutions mature, the value of exchange rate flexibility increases. This study assesses the historical durability and performance of alternative exchange rate regimes, with special focus on developing and emerging market countries. It describes trends in the distribution of regimes and examines the transitions between regimes. It also reviews the performance of exchange rate regimes in terms of inflation and business cycles.

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Bibliographic Info

Paper provided by International Monetary Fund in its series IMF Occasional Papers with number 229.

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Length: 62
Date of creation: 26 May 2004
Date of revision:
Handle: RePEc:imf:imfocp:229

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Related research

Keywords: Exchange rate regimes; exchange rate; inflation; exchange rates; exchange rate regime; exchange rate flexibility; foreign exchange; inflation performance; lower inflation; monetary policy; macroeconomic performance; exchange rate volatility; inflation targeting; real exchange rate; money growth; flexible exchange rates; exchange rate movements; flexible exchange rate; fixed exchange rate; high inflation; annual inflation; foreign currency; dual exchange rates; floating exchange rates; foreign exchange markets; exchange markets; inflation rates; real exchange rates; trade openness; exchange rate arrangements; exchange rate pegs; exchange rate rigidity; flexible exchange arrangements; exchange rate regime classification; fixed exchange rate policy; real exchange rate volatility; monetary union; transition economies; fixed exchange rates; exchange rate system; inflation rate; rigid nominal exchange rate; currency unions; floating exchange rate; inflationary expectations; money supply; exchange rate variability; multiple exchange rates; alternative exchange rate; exchange rate systems; market exchange rates; classification of exchange rate; monetary economics; exchange rate policies; trade shocks; terms-of-trade volatility; currency values; stable exchange rates; exchange rate data; exchange rate stability; network externalities; external trade; exchange rate change; terms-of-trade shocks; official exchange rate; political economy; exchange restrictions; floating exchange rate regime; currency boards; foreign exchange reserves; de facto exchange rate regime; real interest rates; average inflation; exchange rate arrangement; de facto exchange reserves; alternative foreign exchange rates; rate of inflation; exchange rate depreciation; natural exchange rate; black market; inflation target; real effective exchange rate; exchange rate anchor; exchange rate band; average inflation rate; freely floating exchange rate; inflation growth; floating exchange controls; exchange rate changes; exchange rate guarantee; real rates; low inflation; effective exchange rate; exchange rate target; flexible exchange rate regime; price inflation; explicit exchange rate; annual inflation rate; flexible exchange rate system; currency convertibility; parallel exchange rate; currency areas; history of exchange rate; bilateral exchange rate; exchange rate behavior; alternative exchange rate regime; exchange rate unification; exchange rate regime classifications; fixed exchange rate regime; basket of currencies; macroeconomic stability; exchange rate path; exchange rate crises; exchange rate choices; intermediate exchange rate; exchange rate pass; independent central bank; monetary unions; closed economies; partner countries; measures of volatility; global shocks; export growth; external financing; trade flows; trading partners; trade partner;

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References

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