IDEAS home Printed from https://ideas.repec.org/p/wbk/wboper/16107.html
   My bibliography  Save this paper

Latin America’s Deceleration and the Exchange Rate Buffer : LAC Semiannual Report, October 2013

Author

Listed:
  • Augusto de la Torre
  • Eduardo Levy Yeyati
  • Samuel Pienknagura

Abstract

This semiannual report examines the short and medium-term challenges for Latin America and the Caribbean (LAC) as the external factors that were instrumental in the region’s recent performance recede. In particular, we address the role of the exchange rate as a counter-cyclical policy tool to buffer adverse external shocks. As is customary in this series, Chapter 1 starts by providing an overview of the global economy and its implications for the short and medium-term prospects of the LAC region. It also examines the vulnerabilities of the region as tailwinds recede. Chapter 2 describes the new role of the exchange rate as a shock absorber in LAC amid the important transformations observed in the region in the past decade on the macro-financial front. Finally, Chapter 3 gives a detailed look at exchange rate-smoothing policy interventions.

Suggested Citation

  • Augusto de la Torre & Eduardo Levy Yeyati & Samuel Pienknagura, "undated". "Latin America’s Deceleration and the Exchange Rate Buffer : LAC Semiannual Report, October 2013," World Bank Other Operational Studies 16107, The World Bank.
  • Handle: RePEc:wbk:wboper:16107
    as

    Download full text from publisher

    File URL: https://openknowledge.worldbank.org/bitstream/handle/10986/16107/9781464801150_En.pdf?sequence=1
    Download Restriction: no

    References listed on IDEAS

    as
    1. Juan José Echavarría & Luis Fernando Melo Velandia & Santiago Téllez & Mauricio Villamizar, 2013. "The Impact of Pre-announced Day-to-day Interventions on the Colombian Exchange Rate," BORRADORES DE ECONOMIA 010767, BANCO DE LA REPÚBLICA.
    2. Erick Lahura & Marco Vega, 2013. "Asymmetric effects of FOREX intervention using intraday data: evidence from Peru," BIS Working Papers 430, Bank for International Settlements.
    3. Guillermo A. Calvo & Carmen M. Reinhart, 2002. "Fear of Floating," The Quarterly Journal of Economics, Oxford University Press, vol. 117(2), pages 379-408.
    4. Obstfeld, Maurice, 2002. "Exchange Rates and Adjustment: Perspectives from the New Open- Economy Macroeconomics," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 20(S1), pages 23-46, December.
    5. Bouakez, Hafedh & Rebei, Nooman, 2008. "Has exchange rate pass-through really declined? Evidence from Canada," Journal of International Economics, Elsevier, vol. 75(2), pages 249-267, July.
    6. Hiau Looi Kee & Alessandro Nicita & Marcelo Olarreaga, 2008. "Import Demand Elasticities and Trade Distortions," The Review of Economics and Statistics, MIT Press, vol. 90(4), pages 666-682, November.
    7. Eduardo Levy-Yeyati & Sergio L. Schmukler & Neeltje van Horen, 2010. "Crises, Capital Controls and Financial Integration," Chapters,in: Managing Capital Flows, chapter 6 Edward Elgar Publishing.
    8. Pablo Fajnzylber & J. Humberto López, 2008. "Remittances and Development : Lessons from Latin America," World Bank Publications, The World Bank, number 6911, January.
    9. Joshua Aizenman & Jaewoo Lee, 2007. "International Reserves: Precautionary Versus Mercantilist Views, Theory and Evidence," Open Economies Review, Springer, vol. 18(2), pages 191-214, April.
    10. Augusto de la Torre & Samuel Pienknagura & Eduardo Levy Yeyati, "undated". "Latin America and the Caribbean as Tailwinds Recede : In Search of Higher Growth, LAC Semiannual Report, April 2013," World Bank Other Operational Studies 13266, The World Bank.
    11. Eichengreen, Barry & Gupta, Poonam, 2012. "The Real Exchange Rate and Export Growth: Are Services Different?," Working Papers 12/112, National Institute of Public Finance and Policy.
    12. Augusto de la Torre & Julian Messina & Samuel Pienknagura, "undated". "The Labor Market Story Behind Latin America's Transformation
      [El papel del mercado laboral en la transformación de América Latina]
      ," World Bank Other Operational Studies 11884, The World Bank.
    13. Yeyati, Eduardo Levy & Schmukler, Sergio L. & Van Horen, Neeltje, 2004. "The price of inconvertible deposits: the stock market boom during the Argentine crisis," Economics Letters, Elsevier, vol. 83(1), pages 7-13, April.
    14. De Gregorio, Jose & Edwards, Sebastian & Valdes, Rodrigo O., 2000. "Controls on capital inflows: do they work?," Journal of Development Economics, Elsevier, vol. 63(1), pages 59-83, October.
    15. Dani Rodrik & Mark Rosenzweig (ed.), 2010. "Handbook of Development Economics," Handbook of Development Economics, Elsevier, edition 1, volume 5, number 6, January.
    16. Hausmann, Ricardo & Panizza, Ugo & Stein, Ernesto, 2001. "Why do countries float the way they float?," Journal of Development Economics, Elsevier, vol. 66(2), pages 387-414, December.
    17. Mark, Aguiar & Gopinath, Gita, 2005. "Fire-Sale Foreign Direct Investment and Liquidity Crises," Scholarly Articles 3634155, Harvard University Department of Economics.
    18. Stephen Murchison, 2009. "Exchange Rate Pass-through and Monetary Policy: How Strong is the Link?," Staff Working Papers 09-29, Bank of Canada.
    19. Augusto de la Torre & Eduardo Levy Yeyati & Sergio L. Schmukler, 2003. "Living and Dying with Hard Pegs: The Rise and Fall of Argentina’s Currency Board," ECONOMIA JOURNAL, THE LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION - LACEA, vol. 0(Spring 20), pages 43-108, January.
    20. Gustavo Adler & Camilo E Tovar Mora, 2011. "Foreign Exchange Intervention; A Shield Against Appreciation Winds?," IMF Working Papers 11/165, International Monetary Fund.
    21. Cesar Calderon & Tatiana Didier, 2009. "Will FDI be Resilient in this Crisis?," World Bank Other Operational Studies 11000, The World Bank.
    22. Olivier Jeanne & Romain Rancière, 2011. "The Optimal Level of International Reserves For Emerging Market Countries: A New Formula and Some Applications," Economic Journal, Royal Economic Society, vol. 121(555), pages 905-930, September.
    23. Freund, Caroline & Pierola, Martha Denisse, 2012. "Export surges," Journal of Development Economics, Elsevier, vol. 97(2), pages 387-395.
    24. Pablo Pincheira, 2013. "Interventions and inflation expectations in an inflation targeting economy," BIS Working Papers 427, Bank for International Settlements.
    25. Jean Imbs & Isabelle Mejean, 2010. "Trade Elasticities: A Final Report for the European Commission," European Economy - Economic Papers 2008 - 2015 432, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    26. Dubravko Mihaljek & Marc Klau, 2008. "Exchange rate pass-through in emerging market economies: what has changed and why?," BIS Papers chapters,in: Bank for International Settlements (ed.), Transmission mechanisms for monetary policy in emerging market economies, volume 35, pages 103-130 Bank for International Settlements.
    27. Sebastian Edwards, 1999. "How Effective Are Capital Controls?," Journal of Economic Perspectives, American Economic Association, vol. 13(4), pages 65-84, Fall.
    28. Maurizio Bussolo & María Soledad Martínez Peria & César Calderón & Yira Mascaró & Mette E. Nielsen & Pablo Acosta & J. Humberto López & Çaglar Özden & Yoko Niimi & Luis Molina & Florencia Moizeszowicz, 2008. "Remittances and Development: Lessons from Latin America," IDB Publications (Books), Inter-American Development Bank, number 59678 edited by J. Humberto López & Pablo Fajnzylber, February.
    29. Aghion, Philippe & Bacchetta, Philippe & Rancière, Romain & Rogoff, Kenneth, 2009. "Exchange rate volatility and productivity growth: The role of financial development," Journal of Monetary Economics, Elsevier, vol. 56(4), pages 494-513, May.
    30. Mark Aguiar & Gita Gopinath, 2005. "Fire-Sale Foreign Direct Investment and Liquidity Crises," The Review of Economics and Statistics, MIT Press, vol. 87(3), pages 439-452, August.
    31. Lederman, Daniel, 2011. "Large devaluations, foreign direct investment and exports : a speculative note," Policy Research Working Paper Series 5619, The World Bank.
    32. repec:idb:brikps:59678 is not listed on IDEAS
    33. Bello, Omar & Heresi, Rodrigo & Pineda Salazar, Ramón, 2010. "El tipo de cambio real de equilibrio: un estudio para 17 países de América Latina," Macroeconomía del Desarrollo 82, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    34. Chris Becker & Michael Sinclair, 2004. "Profitability of Reserve Bank Foreign Exchange Operations: Twenty Years After the Float," RBA Research Discussion Papers rdp2004-06, Reserve Bank of Australia.
    35. Vicki Newman & Chris Potter & Michelle Wright, 2011. "Foreign Exchange Market Intervention," RBA Bulletin, Reserve Bank of Australia, pages 67-76, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Guglielmo Maria Caporale & Abdurrahman Nazif Catik & Mohamad Husam Helmi & Faek Menla Ali & Coskun Akdeniz, 2016. "Monetary Policy Rules in Emerging Countries: Is There an Augmented Nonlinear Taylor Rule?," Discussion Papers of DIW Berlin 1588, DIW Berlin, German Institute for Economic Research.
    2. Daude, Christian & Levy Yeyati, Eduardo & Nagengast, Arne J., 2016. "On the effectiveness of exchange rate interventions in emerging markets," Journal of International Money and Finance, Elsevier, vol. 64(C), pages 239-261.
    3. Roberto Alvarez & Jose De Gregorio, 2014. "Understanding Differences in Growth Performance in Latin America and Developing Countries between the Asian and Global Financial Crises," Working Paper Series WP14-11, Peterson Institute for International Economics.
    4. Cord, Louise & Barriga Cabanillas, Oscar & Lucchetti, Leonardo & Rodriguez-Castelan, Carlos & Sousa, Liliana D. & Valderrama, Daniel, 2014. "Inequality stagnation in Latin America in the aftermath of the global financial crisis," Policy Research Working Paper Series 7146, The World Bank.
    5. Augusto de la Torre & Alain Ize & Samuel Pienknagura, "undated". "Latin America Treads a Narrow Path to Growth," World Bank Other Operational Studies 21699, The World Bank.
    6. de la Torre, Augusto & Didier, Tatiana & Pinat, Magali, 2014. "Can Latin America tap the globalization upside ?," Policy Research Working Paper Series 6837, The World Bank.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wboper:16107. 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: (Thomas Breineder). General contact details of provider: http://edirc.repec.org/data/dvewbus.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.