External Financial Stress and External Financing Vulnerability in Turkey : Some Policy Implications for Financial Stability
External financial stress is one of the causes of capital outflows and reduction in borrowing ability of emerging markets. Sudden reversal of capital inflows and disruption in access to the international capital markets could be a threat for the domestic financial stability as in the case of Asian Crisis in 1997-1998. This paper analyses the behavior of external financing sources of Turkey, namely FX non-core liabilities of the banking system and portfolio flows, for periods 1995-2000 and 2004-2012. Our results show that unlike the 1995-2000 period, FX non-core liabilities of the banking system are very sensitive to the external financial stress during the 2004-2012 period. Portfolio flows decline in both cases but with a higher magnitude in the second period. Our results have important policy implications.
|Date of creation:||2013|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (90 312) 507 5000
Fax: (90 312) 507 5640
Web page: http://www.tcmb.gov.tr
More information through EDIRC
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.:
- David O. Cushman & Tao Zha, 1995.
"Identifying monetary policy in a small open economy under flexible exchange rates,"
95-7, Federal Reserve Bank of Atlanta.
- Cushman, David O. & Zha, Tao, 1997. "Identifying monetary policy in a small open economy under flexible exchange rates," Journal of Monetary Economics, Elsevier, vol. 39(3), pages 433-448, August.
- Burcu Aydin & Deniz Igan, 2010.
"Bank Lending in Turkey; Effects of Monetary and Fiscal Policies,"
IMF Working Papers
10/233, International Monetary Fund.
- Burcu Aydin & Deniz Igan, 2012. "Bank Lending in Turkey: Effects of Monetary and Fiscal Policies," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 48(5), pages 78-104, September.
- Roberto Rigobon, 2001.
"Contagion: How to Measure It?,"
NBER Working Papers
8118, National Bureau of Economic Research, Inc.
- Graciela L. Kaminsky & Carmen Reinhart, 2003.
"The Center and the Periphery: The Globalization of Financial Turmoil,"
NBER Working Papers
9479, National Bureau of Economic Research, Inc.
- Reinhart, Carmen & Kaminsky, Graciela, 2008. "The center and the periphery: The globalization of financial turmoil," MPRA Paper 14100, University Library of Munich, Germany.
- Michael P. Dooley, 1997.
"Financial Liberalization and Policy Challenges,"
Research Department Publications
4102, Inter-American Development Bank, Research Department.
- Stephan Danninger & Irina Tytell & Ravi Balakrishnan & Selim Elekdag, 2009. "The Transmission of Financial Stress From Advanced to Emerging Economies," IMF Working Papers 09/133, International Monetary Fund.
When requesting a correction, please mention this item's handle: RePEc:tcb:wpaper:1317. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ozlem Ekmekciler Ramalho Rocha)or (Ilker Cakar)
If references are entirely missing, you can add them using this form.