PPT-Exchange-Rate Policy &

the Central Bank Chapter 19 Exchange Rates are Volatile Costs of Volatile Exchange Rates Exchange rate volatility increases risk in international finance Ex Many developing economy corporates issue securities in US An exchange rate devaluation will make this more expensive to repay . Two polar cases. Fixed (pegged) exchange rates. CB buys or sells reserves to maintain a set price of foreign exchange. Flexible exchange rates. CB does not intervene in market for foreign exchange. and . Currency Exchange Rates: Determination and Forecasting. Presenter’s name. Presenter’s title. dd. Month . yyyy. 1. Introduction. An . exchange rate . is the price of one currency in terms of another.. Lecture at EPOG, . Economic . Policies . in the age of . Globalization . – Erasmus Mundus Master's course. . Paris, September 14, 2015. .. It . originates from. Development Economics or Classical Developmentalism (pioneers of development). Thoughts on sources of technological change. Real business cycles: A sketch. Open economy macroeconomics. International financial system. Short-run open-economy output determination (Mundell -Fleming model). Slide Set . 1. Introduction to . the Course: the Global Economy. Introduction to the Global . Macroeconomy. Our course can be divided across three broad topics:. Foreign exchange: currencies, exchange rates, and crises. Econ 102 . 2015. Key player in the financial markets:. CENTRAL BANKS:. Every sovereign nation has a bank which is the ‘lender of the last resort’.. The Central Banks is a financial institution owned by the government, which is in charge of ‘managing the currency’. International . Political Economy. Prof. Tyson Roberts. Balance of Payments (. BoP. ). Current account. Current account balance =. Current receipts – Current Expenditures. Current includes . Goods & services. . Some Unanswered Questions. Rashad . Cassim. Economic Research and Statistics . Stellenbosch University. 27/02/2017. Objectives of Presentation. T. o share with you some of the analytical and empirical difficulties we experience in making sense of the current . International Political Economy. Prof. Tyson Roberts. 1. Goals. Macroeconomic . Trilemma. Review. State-centered approach to macroeconomic policy. Central Bank Independence. Argentina case – the beginning…. Chapter 17 Krugman, Obstfeld, and Melitz 10e. ECO41 International Economics. Udayan. Roy. Long Run and Short Run. Long run theories are useful when all prices of inputs and outputs have enough time to adjust fully to changes in supply and demand.. Care About Exchange Rates . in Addition to Inflation?. SNB-IMF Conference on. the International Monetary System. Zurich, May 13, 2014. Jeffrey Frankel. Harpel. Professor of Capital Formation & Growth Harvard University. Why do some countries choose to fix. and others to float? Why do they. change their minds at different times?. These are among the most enduring and controversial questions in international macroeconomics.. accounting identities for the open economy. the small open economy model. what makes it “small”. how the trade balance and exchange rate are determined. how policies affect trade balance & exchange rate. the Mundell-Fleming model. Case 1. Flexible exchange rate regime. Monetary policy effectiveness. (Changes in money supply). An increase in money supply (M/P=l. 1. Y-l. 2. i eq.1.6) reduces the local interest rate and increases investments and output (eq. 1.1 and 1.3). Since the model represents an open economy, the local interest rate is now lower than the global interest rate. The UIP is no longer verified (.