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De jure versus de facto: Exchange rate stabilization in Central and Eastern Europe

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  • Schnabl, Gunther

Abstract

The IMF classifications of the Central and Eastern European exchange rate arrangements are heterogeneous. While one group of countries reports tight pegs to the euro, a second group seems to have moved toward (more) exchange rate flexibility. Based on the recent discussion about the accuracy of IMF exchange rate arrangement classifications, low- and highfrequency exchange rate stability in Central and Eastern Europe is explored here. In this paper we find that de facto exchange rate stabilization is much more prevalent in Central and Eastern Europe than suggested by de jure exchange rate classifications. Most of the CEE countries peg their currencies to the euro, thereby contributing to a growing euro zone. Nevertheless, as exchange rate stabilization against the euro is pursued with different degrees and with different long-term drifts, intra-regional exchange rates are still far from being unified.

Suggested Citation

  • Schnabl, Gunther, 2003. "De jure versus de facto: Exchange rate stabilization in Central and Eastern Europe," Tübinger Diskussionsbeiträge 269, University of Tübingen, School of Business and Economics.
  • Handle: RePEc:zbw:tuedps:269
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    More about this item

    Keywords

    Foreign Exchange Policy; EMU; Euro Zone; Central and Eastern Europe;
    All these keywords.

    JEL classification:

    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions

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