An Institutional Framework for Comparing Emerging Market Currency Boards

September 1, 2004

Preview Citation

Format: Chicago

Marie-Therese Camilleri. An Institutional Framework for Comparing Emerging Market Currency Boards, (USA: International Monetary Fund, 2004) 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 offers an in-depth review of the institutional arrangements underlying existing currency boards (CBAs) in Argentina (until 2001), Eastern Europe, and Asia. An index of precommitment is derived from an analysis of legislative frameworks and monetary policy operations. The index covers features associated with monetary and exchange rate credibility such as: (i) clarity of legal basis, (ii) quality of reserve coverage, (iii) coverage of monetary aggregates, (iv) claims on reserves, (v) operational autonomy, (vi) transparency and accountability, and (vii) escape clauses. The paper concludes with a discussion of flexibility and credibility trade-offs and exit issues.

Subject: Conventional peg, Currencies, Exchange rate arrangements, Exchange rates, Foreign exchange, Inflation, Money, Prices

Keywords: Baltics, C. quantifying CBA deviation, CBA adjustment mechanism, CBA autonomy, CBA country, CBA economy, CBA feature, CBA framework, CBA provisions, CBA statute, CBA strategy, Conventional peg, Credibility, Currencies, Currency Boards, Exchange rate arrangements, Exchange rate regime, Exchange rates, Inflation, Institutional Design, Monetary Policy, Precommitment, Reserve currency, Reserves, Stabilization policy, WP

Publication Details

Pages:

42
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2004/180
Stock No:

WPIEA1802004
ISBN:

9781451859140
ISSN:

1018-5941

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