Author: Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Foreign Exchange Intervention and Monetary Policy in Japan, 2003-04
Author: Foreign Exchange Intervention and Monetary Policy in Japan, 2003-04
Author: Rasmus FatumPublisher:
ISBN:
Category :
Languages : en
Pages : 39
Book Description
This paper examines the rationale behind the massive increase in Japanese foreign exchange market intervention operations in 2003-04, and evaluates its effectiveness both in limiting yen exchange rate appreciation and influencing the direction of monetary policy. The two main questions addressed in this study are: Was the intervention effective in slowing exchange rate appreciation compared to a counterfactual case with no intervention? And, has intervention on such a large scale authorized by the Ministry of Finance been able to directly influence liquidity creation or indirectly influence the stance of Bank of Japan policy?
EPRU Working Papers
Author: Rasmus FatumJapanese Monetary Policy
Author: Kenneth J. SingletonPublisher: University of Chicago Press
ISBN: 0226760685
Category : Business & Economics
Languages : en
Pages : 208
Book Description
How has the Bank of Japan (BOJ) helped shape Japan's economic growth during the past two decades? This book comprehensively explores the relations between financial market liberalization and BOJ policies and examines the ways in which these policies promoted economic growth in the 1980s. The authors argue that the structure of Japan's financial markets, particularly restrictions on money-market transactions and the key role of commercial banks in financing corporate investments, allowed the BOJ to influence Japan's economic success. The first two chapters provide the most in-depth English-language discussion of the BOJ's operating procedures and policymaker's views about how BOJ actions affect the Japanese business cycle. Chapter three explores the impact of the BOJ's distinctive window guidance policy on corporate investment, while chapter four looks at how monetary policy affects the term structure of interest rates in Japan. The final two chapters examine the overall effect of monetary policy on real aggregate economic activity. This volume will prove invaluable not only to economists interested in the technical operating procedures of the BOJ, but also to those interested in the Japanese economy and in the operation and outcome of monetary reform in general.
Monetary Policy, Intervention, and Exchange Rates in Japan
Author: Reuven GlickPublisher:
ISBN:
Category : Foreign exchange
Languages : en
Pages : 58
Book Description
Currency Intervention and the Global Portfolio Balance Effect
Author: Petra Gerlach-KristenPublisher:
ISBN:
Category :
Languages : en
Pages : 17
Book Description
This paper shows that the Japanese foreign exchange interventions in 2003/04 seem to have lowered long-term interest rates in a wide range of countries, including Japan. It seems that this decline was triggered by the investment of the intervention proceeds in US bonds and that a global portfolio balance effect spread the resulting decline in US yields to other bond markets, thus easing global monetary conditions.
Strained Relations
Author: Michael D. BordoPublisher: University of Chicago Press
ISBN: 022605151X
Category : Business & Economics
Languages : en
Pages : 453
Book Description
During the twentieth century, foreign-exchange intervention was sometimes used in an attempt to solve the fundamental trilemma of international finance, which holds that countries cannot simultaneously pursue independent monetary policies, stabilize their exchange rates, and benefit from free cross-border financial flows. Drawing on a trove of previously confidential data, Strained Relations reveals the evolution of US policy regarding currency market intervention, and its interaction with monetary policy. The authors consider how foreign-exchange intervention was affected by changing economic and institutional circumstances—most notably the abandonment of the international gold standard—and how political and bureaucratic factors affected this aspect of public policy.
Currency Intervention and the Global Portfolio Balance Effect
Author: Petra Gerlach-KristenPublisher:
ISBN:
Category : Banks and banking
Languages : en
Pages : 14
Book Description
Japan's Currency Intervention
Author: Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
This has raised concerns that Japan may intervene in currency markets for the first time since March 2004 to shore up the value of the dollar and slow the appreciation of the yen. [...] One problem with the focus on currency intervention to correct balance of trade deficits is that only about half of the increase in the value of a foreign currency is reflected in prices of imports into the United States. [...] This is raised concerns that Japan may intervene in currency markets for the first time since March 2004 to shore up the value of the dollar and slow the appreciation of the yen. [...] The intended result was to keep the value of the yen from appreciating too quickly in order to keep the price of Japanese exports from rising in markets such as those in the United States and to maintain the profitability of those exports. [...] For 2003 and 2004, despite the record size and frequency of the intervention by Japan, the authors found it difficult to statistically distinguish the pattern of exchange rate movements on intervention days from that of all the days in that particular subperiod.
Foreign Exchange Intervention Rules for Central Banks: A Risk-based Framework
Author: Romain LafarguettePublisher: International Monetary Fund
ISBN: 1513569406
Category : Business & Economics
Languages : en
Pages : 33
Book Description
This paper presents a rule for foreign exchange interventions (FXI), designed to preserve financial stability in floating exchange rate arrangements. The FXI rule addresses a market failure: the absence of hedging solution for tail exchange rate risk in the market (i.e. high volatility). Market impairment or overshoot of exchange rate between two equilibria could generate high volatility and threaten financial stability due to unhedged exposure to exchange rate risk in the economy. The rule uses the concept of Value at Risk (VaR) to define FXI triggers. While it provides to the market a hedge against tail risk, the rule allows the exchange rate to smoothly adjust to new equilibria. In addition, the rule is budget neutral over the medium term, encourages a prudent risk management in the market, and is more resilient to speculative attacks than other rules, such as fixed-volatility rules. The empirical methodology is backtested on Banco Mexico’s FXIs data between 2008 and 2016.