Balance of Payments Anti-Crises
AbstractSeveral emerging economies have, until recently, experienced large government surpluses and accelerating foreign exchange reserve accumulation. This has been accompanied by economic booms, exchange rate appreciations and in some cases increases in domestic inflation. We show that one way to understand these episodes is as manifestations of balance of payments anti-crises, as reflecting the perception that the government intends to discontinue its accumulation of reserves in the near future. The end-phase of such crises is characterized by nominal interest rates approaching their zero lower bound in accelerating fashion and, if the government targets CPI inflation, by fast increasing domestic inflation.
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 International Monetary Fund in its series IMF Working Papers with number 09/134.
Date of creation: 01 Jun 2009
Date of revision:
Contact details of provider:
Postal: International Monetary Fund, Washington, DC USA
Phone: (202) 623-7000
Fax: (202) 623-4661
Web page: http://www.imf.org/external/pubind.htm
More information through EDIRC
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-10-10 (All new papers)
- NEP-CBA-2009-10-10 (Central Banking)
- NEP-IFN-2009-10-10 (International Finance)
- NEP-MAC-2009-10-10 (Macroeconomics)
- NEP-MON-2009-10-10 (Monetary Economics)
- NEP-OPM-2009-10-10 (Open Economy Macroeconomics)
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.:
- Calvo, Guillermo A. & Vegh, Carlos A., 1999.
"Inflation stabilization and bop crises in developing countries,"
Handbook of Macroeconomics, Elsevier,
in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 24, pages 1531-1614
- Guillermo A. Calvo & Carlos A. Vegh, 1999. "Inflation Stabilization and BOP Crises in Developing Countries," NBER Working Papers 6925, National Bureau of Economic Research, Inc.
- Enrique G. Mendoza, 2005.
"Real Exchange Rate Volatility and the Price of Nontradables in Sudden-Stop-Prone Economies,"
NBER Working Papers
11691, National Bureau of Economic Research, Inc.
- Enrique G. Mendoza, 2006. "Real Exchange Rate Volatility and the Price of Nontradables in Sudden-Stop-Prone Economies," IMF Working Papers 06/88, International Monetary Fund.
- Shujing Li & Isabel K. Yan & Michael Kumhof, 2007.
"Balance of Payments Crises Under Inflation Targeting,"
IMF Working Papers
07/84, International Monetary Fund.
- Kumhof, Michael & Li, Shujing & Yan, Isabel, 2007. "Balance of payments crises under inflation targeting," Journal of International Economics, Elsevier, Elsevier, vol. 72(1), pages 242-264, May.
- Michael Kumhof & Shujing Li & Isabel Yan, . "Balance of Payments Crises Under Inflation Targeting," Working Papers, Stanford University, Department of Economics 00020, Stanford University, Department of Economics.
- Calvo, Guillermo A, 1987. "Balance of Payments Crises in a Cash-in-Advance Economy," Journal of Money, Credit and Banking, Blackwell Publishing, Blackwell Publishing, vol. 19(1), pages 19-32, February.
- Herman Kamil, 2008. "Is Central Bank Intervention Effective Under Inflation Targeting Regimes? the Case of Colombia," IMF Working Papers 08/88, International Monetary Fund.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jim Beardow) or (Hassan Zaidi).
If references are entirely missing, you can add them using this form.