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Understanding Reserve Volatility in Emerging Markets: A Look at the Last Thirty Years

Author

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  • Ricarda Demarmels

    (Swiss National Bank and University of St. Gallen)

  • Andreas M. Fischer

    (Swiss National Bank)

Abstract

In this paper, we examine external, monetary, and structural determinants of cross-country variation in reserve volatility for 30 emerging market economies from 1973 to 2000. We find that reserve holdings and openess to be the most important determinants of reserve volatility. These results are robust for a range of control variables, including monetary variables, the degree of financial development, and the level of indebtness. We view these results as establishing interesting stylized facts that may be helpful in evaluating reserve ubncertainty as a crises indicator.

Suggested Citation

  • Ricarda Demarmels & Andreas M. Fischer, 2002. "Understanding Reserve Volatility in Emerging Markets: A Look at the Last Thirty Years," Working Papers 02.02, Swiss National Bank, Study Center Gerzensee.
    • Handle: RePEc:szg:worpap:0202
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    References listed on IDEAS

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