IMF Working Papers

Experience with Floating Interbank Exchange Rate Systems in Five Developing Economies

By Vicente Galbis

April 1, 1993

Preview Citation

Format: Chicago

Vicente Galbis. Experience with Floating Interbank Exchange Rate Systems in Five Developing Economies, (USA: International Monetary Fund, 1993) accessed November 21, 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

This paper reviews the experience with floating interbank exchange rate systems in five developing countries--The Gambia, Guyana, Jamaica, Nigeria and Sri Lanka--and draws some conclusions about the stability and efficiency of these systems. The experience of these countries illustrates both the difficulties and the advantages of interbank exchange rate markets. The main conclusion is that these markets can operate relatively well with a minimum banking infrastructure, provided that the authorities remove legal and institutional impediments to the free operation of these markets including, in particular, exchange restrictions. Any residual restrictions that may remain will likely give rise to the continued existence of parallel markets.

Subject: Currency markets, Exchange rate arrangements, Exchange rates, Financial markets, Foreign exchange, Interbank markets

Keywords: Auction rate, Cambio market, Cambio market participant, Central bank, Currency markets, Exchange arrangement, Exchange rate, Exchange rate arrangements, Exchange rate system, Exchange rates, Floating exchange rate system, Free market, Interbank markets, Liberalization measure, Market, Market abuse, Market instability, Market rate, Rate, Rate depreciation, WP

Publication Details

  • Pages:

    42

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 1993/036

  • Stock No:

    WPIEA0361993

  • ISBN:

    9781451977943

  • ISSN:

    1018-5941

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