Asymmetric monetary and exchange-rate policies in Latin American countries that use inflation targeting
In recent decades, Latin American countries have adopted more flexible exchange-rate regimes and set inflation targets. Several authors argue that some countries’ monetary and exchange-rate policies suffer from a procyclical bias, whereby central banks are reluctant to reduce interest rates when inflation falls, but are willing to increase them when inflation edges up. Therefore, the exchange rate tends to appreciate a lot and depreciate little. This paper analyses the asymmetry of the monetary and exchange rate policies of the five largest Latin American countries in which inflation targets are used: Brazil, Chile, Colombia, Mexico and Peru. Nonlinear econometric techniques are used to show that there is "fear of floating", except possibly in Chile and Peru, and that the symptoms are more pronounced in Brazil and Mexico.
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2018-08-18
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| Subjects: | POLITICA MONETARIA, TIPOS DE CAMBIO, INFLACION, MODELOS ECONOMETRICOS, ESTUDIOS DE CASOS, MONETARY POLICY, FOREIGN EXCHANGE RATES, INFLATION, ECONOMETRIC MODELS, CASE STUDIES, |
| Online Access: | https://hdl.handle.net/11362/44318 |
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dig-cepal-11362-443182023-01-30T18:19:36Z Asymmetric monetary and exchange-rate policies in Latin American countries that use inflation targeting Libman, Emiliano POLITICA MONETARIA TIPOS DE CAMBIO INFLACION MODELOS ECONOMETRICOS ESTUDIOS DE CASOS MONETARY POLICY FOREIGN EXCHANGE RATES INFLATION ECONOMETRIC MODELS CASE STUDIES In recent decades, Latin American countries have adopted more flexible exchange-rate regimes and set inflation targets. Several authors argue that some countries’ monetary and exchange-rate policies suffer from a procyclical bias, whereby central banks are reluctant to reduce interest rates when inflation falls, but are willing to increase them when inflation edges up. Therefore, the exchange rate tends to appreciate a lot and depreciate little. This paper analyses the asymmetry of the monetary and exchange rate policies of the five largest Latin American countries in which inflation targets are used: Brazil, Chile, Colombia, Mexico and Peru. Nonlinear econometric techniques are used to show that there is "fear of floating", except possibly in Chile and Peru, and that the symptoms are more pronounced in Brazil and Mexico. 2018-12-18T20:14:47Z 2018-12-18T20:14:47Z 2018-08-18 Texto Sección o Parte de un Documento https://hdl.handle.net/11362/44318 LC/PUB.2018/6-P 2 en CEPAL Review CEPAL Review 125 .pdf application/pdf AMERICA LATINA BRASIL CHILE COLOMBIA MEXICO PERU BRAZIL CHILE COLOMBIA LATIN AMERICA MEXICO PERU |
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POLITICA MONETARIA TIPOS DE CAMBIO INFLACION MODELOS ECONOMETRICOS ESTUDIOS DE CASOS MONETARY POLICY FOREIGN EXCHANGE RATES INFLATION ECONOMETRIC MODELS CASE STUDIES POLITICA MONETARIA TIPOS DE CAMBIO INFLACION MODELOS ECONOMETRICOS ESTUDIOS DE CASOS MONETARY POLICY FOREIGN EXCHANGE RATES INFLATION ECONOMETRIC MODELS CASE STUDIES |
| spellingShingle |
POLITICA MONETARIA TIPOS DE CAMBIO INFLACION MODELOS ECONOMETRICOS ESTUDIOS DE CASOS MONETARY POLICY FOREIGN EXCHANGE RATES INFLATION ECONOMETRIC MODELS CASE STUDIES POLITICA MONETARIA TIPOS DE CAMBIO INFLACION MODELOS ECONOMETRICOS ESTUDIOS DE CASOS MONETARY POLICY FOREIGN EXCHANGE RATES INFLATION ECONOMETRIC MODELS CASE STUDIES Libman, Emiliano Asymmetric monetary and exchange-rate policies in Latin American countries that use inflation targeting |
| description |
In recent decades, Latin American countries have adopted more flexible exchange-rate regimes and set inflation targets. Several authors argue that some countries’ monetary and exchange-rate policies suffer from a procyclical bias, whereby central banks are reluctant to reduce interest rates when inflation falls, but are willing to increase them when inflation edges up. Therefore, the exchange rate tends to appreciate a lot and depreciate little. This paper analyses the asymmetry of the monetary and exchange rate policies of the five largest Latin American countries in which inflation targets are used: Brazil, Chile, Colombia, Mexico and Peru. Nonlinear econometric techniques are used to show that there is "fear of floating", except possibly in Chile and Peru, and that the symptoms are more pronounced in Brazil and Mexico. |
| format |
Texto |
| topic_facet |
POLITICA MONETARIA TIPOS DE CAMBIO INFLACION MODELOS ECONOMETRICOS ESTUDIOS DE CASOS MONETARY POLICY FOREIGN EXCHANGE RATES INFLATION ECONOMETRIC MODELS CASE STUDIES |
| author |
Libman, Emiliano |
| author_facet |
Libman, Emiliano |
| author_sort |
Libman, Emiliano |
| title |
Asymmetric monetary and exchange-rate policies in Latin American countries that use inflation targeting |
| title_short |
Asymmetric monetary and exchange-rate policies in Latin American countries that use inflation targeting |
| title_full |
Asymmetric monetary and exchange-rate policies in Latin American countries that use inflation targeting |
| title_fullStr |
Asymmetric monetary and exchange-rate policies in Latin American countries that use inflation targeting |
| title_full_unstemmed |
Asymmetric monetary and exchange-rate policies in Latin American countries that use inflation targeting |
| title_sort |
asymmetric monetary and exchange-rate policies in latin american countries that use inflation targeting |
| publishDate |
2018-08-18 |
| url |
https://hdl.handle.net/11362/44318 |
| work_keys_str_mv |
AT libmanemiliano asymmetricmonetaryandexchangeratepoliciesinlatinamericancountriesthatuseinflationtargeting |
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