IMF Working Papers

Monetary Transmission Mechanisms in Belarus

By Rodolfo Maino, Balázs Horváth

November 1, 2006

Download PDF

Preview Citation

Format: Chicago

Rodolfo Maino, and Balázs Horváth. Monetary Transmission Mechanisms in Belarus, (USA: International Monetary Fund, 2006) accessed November 23, 2024
Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

We explore monetary policy transmission by estimating VAR impulse response functions to illustrate the Belarusian economy's response to unexpected changes in policy and exogenous variables. We find a significant exchange rate pass-through to prices, and interest rate policy following, rather than leading, financial market developments. Our estimated monetary policy reaction function shows the central bank striking a balance between real exchange rate stability and containing inflation. We discuss dollarization, administrative interventions, and other features complicating monetary policy transmission, review specific constraints and vulnerabilities, and conclude with observations on possible measures that could raise the effectiveness of monetary policy in Belarus.

Subject: Currencies, Dollarization, Exchange rates, Foreign exchange, Inflation, Monetary policy, Money, Prices, Real exchange rates

Keywords: Banking system, Central bank, Currencies, Dollarization, Dollarization., Exchange rate, Exchange rate expectation, Exchange rates, Foreign exchange, Inflation, Interest rate, Interest rate channel, Monetary management, Monetary policy, Monetary policy action, Monetary policy effectiveness, Monetary policy formulation, Monetary policy implementation, Monetary policy transmission channels, NBRB's monetary policy strategy, Real exchange rates, Southeast Asia, Transmission mechanisms, Vis-à-vis U.S. dollar, WP

Publication Details

  • Pages:

    22

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2006/246

  • Stock No:

    WPIEA2006246

  • ISBN:

    9781451865066

  • ISSN:

    1018-5941

Supplemental Resources

You May Also Be Interested In...

Sierra Leone: Selected Issues

November 22, 2024

Bilateral Trade in Services and Exchange Rates: Evidence of Dominant Currency Pricing

November 22, 2024

The Role of Corporate Cash Holdings in the Transmission of Monetary Policy Tightening

November 22, 2024

Kiribati: Agricultural Subsidies for Copra: Improving Efficiency and Equity and Balancing Trade-offs

November 21, 2024