Monetary Policy in the Conditions of Influence of Negative Factors of the World Economy

2019 ◽  
Vol 7 (1) ◽  
pp. 8-13 ◽  
Author(s):  
Ольга Николайчук ◽  
Olga Nikolaychuk ◽  
Д. Кадырова ◽  
D. Kadyrova
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
World Economy ◽  
Exchange Rate Regime ◽  
Global Market ◽  
Energy Prices ◽  
Consumer Prices ◽  
The World ◽  
The Impact ◽  
Negative Factors

The article analyzes the monetary policy in the context of exogenous shocks of the external sector. The Bank of Russia and Rosstat use official statistics for 2000–2018. The parameters of the action of negative factors of the world economy apply the conditions of world trade and changes in the exchange rate of national currencies. The graphic form analyzes the susceptibility of macroeconomic indicators to changes in the external market and their dependence on fluctuations in energy prices. The influence of consumer prices and inflation on the monetary policy of the Central Bank is considered. The analysis allows us to conclude about the relationship of the effect of events from processes in the global market. It was concluded that, despite these risks, there are optimal ways of conducting monetary policy, which remain the targeting of inflation and the effect of the floating exchange rate regime of the national currency. For effective results in reducing the dependence of macroeconomic processes on the impact of external shocks, coordinated activities of all branches of economic power, and their effective macro-prudential and fiscal policies are important.

scholarly journals Inflationary Processes in Russia Amid the COVID-19 Pandemic

2021 ◽  
pp. 52-60
Author(s):  
Dz. I. Ramazanov ◽  
E. Yu. Onopyuk
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Public Debt ◽  
World Economy ◽  
Consumer Price Index ◽  
Policy Instruments ◽  
Graphical Analysis ◽  
The World ◽  
Food Market ◽  
The Impact

The article examines inflationary processes in Russia and the impact of the coronavirus recession on them. The need for this study is due to the fact that the existing factors of inflation in modern conditions "overgrown" with new causes due to changes in the world economy. Using the methods of positive and normative analysis, tabular and graphical analysis, factors that have a particular impact on inflation are considered, taking into account the events taking place in the world economy. As a result, the study showed that the exchange rate, the situation on the food market and budget financing are the factors that had the most significant impact on inflation in Russia. The conclusion is made about the significant role of the dynamics of the ruble exchange rate in the deployment of inflation, the contribution of agflation and price disparity to the consumer price index. The directions of struggle against price disparity and their use in anti-inflationary strategy are considered. The duality of the nature of public debt and inflation is revealed, a conclusion is made about the possibility of increasing public debt, and possible inflationary scenarios for the economy are given. Based on the results of the study, it is proposed to use an anti-inflationary strategy that would fully take into account inflation factors and adequate anti-inflationary policy instruments. The growth of public debt, according to the authors, will have a delayed inflationary effect; tightening of monetary policy is in conflict with the achievement of sustainable rates of economic growth. Anti-inflationary policy should be aimed at leveling external shocks while maintaining the guidelines for a stimulating monetary policy.

Impact of external currency exposures on macroeconomic policies

2020 ◽  
pp. 23-40
Author(s):  
I. V. Prilepskiy
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Positive Impact ◽  
Exchange Rate Regime ◽  
Macroeconomic Policies ◽  
Panel Regressions ◽  
Financial Account ◽  
Currency Exposure ◽  
Cross Country ◽  
The Impact

Based on cross-country panel regressions, the paper analyzes the impact of external currency exposures on monetary policy, exchange rate regime and capital controls. It is determined that positive net external position (which, e.g., is the case for Russia) is associated with a higher degree of monetary policy autonomy, i.e. the national key interest rate is less responsive to Fed/ECB policy and exchange rate fluctuations. Therefore, the risks of cross-country synchronization of financial cycles are reduced, while central banks are able to place a larger emphasis on their price stability mandates. Significant positive impact of net external currency exposure on exchange rate flexibility and financial account liberalization is only found in the context of static models. This is probably due to the two-way links between incentives for external assets/liabilities accumulation and these macroeconomic policy tools.

Understanding the exchange rate pass-through to consumer prices in Vietnam: the SVAR approach

2019 ◽  
Vol 15 (5) ◽  
pp. 971-989 ◽  
Author(s):  
Anh The Vo ◽  
Chi Minh Ho ◽  
Duc Hong Vo
Keyword(s):  
Exchange Rate ◽  
Economic Integration ◽  
Global Financial Crisis ◽  
Global Market ◽  
Content Type ◽  
Consumer Prices ◽  
The Exchange Rate ◽  
Pass Through ◽  
Exchange Rate Pass Through ◽  
The Impact

Purpose The purpose of this paper is to examine the degree of the exchange rate pass-through (ERPT) to the consumer price index (CPI) at both aggregated and disaggregated levels in Vietnam. Updated data of the nominal effective exchange rate (NEER) and bilateral exchange rate (BiER) have been utilized in this study for the comparison purposes. Design/methodology/approach Advanced time-series approaches such as a structural vector autoregressive framework, structural impulse response functions (SIRFs), and structural forecast-error variance decomposition (SFEVD) are utilized in this paper. Findings Empirical findings from this paper present an incomplete degree of the ERPT to the aggregated CPI. The ERPT based on the BiER is observed to have substantially larger magnitude than the NEER-based pass-through. For the disaggregated level, the degree of the ERPT varies considerably across sub-components of the CPI, with a higher magnitude of the ERPT elasticity being found from the BiER estimations. The index of housing and construction materials has the largest ERPT based on the BiER, followed by the food and foodstuffs (1.00 and 0.56, respectively). The macroeconomic and financial environments as well as an economic integration into the global market may be the main causes of a higher ERPT in Vietnam in comparison with other ASEAN countries. Research limitations/implications The significant and incomplete pass-through of the exchange rate in Vietnam can affect firms’ and households’ budget planning, savings and profits. This finding generally implies that the cost of devaluation of the domestic currency affects the society as the whole in terms of welfare. The State Bank of Vietnam should carefully consider the overall effect of welfares when formulating and implementing strategies of currency devaluation. In addition, the Vietnamese economy becomes more sensitive to external vulnerabilities via changes of the exchange rate during an increasingly economic integration into the global market. In order to maintain inflation stability, it is vitally important to reduce the impact of exchange rate movements on the domestic prices, both aggregated and disaggregated levels, by pursuing either monetary policy credibility or inflation targeting. Originality/value Previous studies on the ERPT literature in the Asia region or for emerging countries focus mainly on the aggregated data of the CPI. Previous studies were conducted before the global financial crisis in 2008/2009. The current paper is the first of its kind to examine the pass-through from exchange rates to consumer prices in Vietnam using both aggregated and disaggregated data.

scholarly journals PERANAN KEBIJAKAN MONETER DALAM MENJAGA STABILITAS PEREKONOMIAN INDONESIA SEBAGAI RESPON TERHADAP FLUKTUASI PEREKONOMIAN DUNIA

2007 ◽  
Vol 9 (2) ◽  
pp. 145-177
Author(s):  
M. Maulana Al Arif ◽  
Achmad Tohari
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Interest Rate ◽  
Open Economy ◽  
Small Open Economy ◽  
Monthly Data ◽  
Vector Autoregressive ◽  
The World ◽  
The Exchange Rate ◽  
The Impact

This paper analyzes the impact of the inflation and the world interest rate on the Indonesian economy and the effectiveness of the Indonesian central bank policy to adopt the domestic macroeconomic fluctuation.Assuming Indonesia as a small-open economy, the Stuctural Vector Autoregressive Model is utilized on the monthly data during the periode of 1999: 1 – 2004: 12 covering the main domestic macroeconomic indicator (output, price, money supply, interest rate and the exchange rate) and the world oil price and world interest rate as the disturbance source.The analysis provides 2 main results, first, the international variables do have impacts on the domestic variables fluctuation, implying the fragility of the domestic economy due to the external shock, second, the monetary policy is effective on supporting the economic growth and stabilizing the price level. However, the Bank Indonesia policy to stabilize the international shock via the exchange rate channel, contributes to a higher impact of the international shock on domestic interest rate.Keywords: monetary policy, business cycle, SVARJEL Classification: E52, E32, C32, F41

Inflation targeting in the world economy and in Russia

2019 ◽  
pp. 5-29 ◽  
Author(s):  
Boris A. Zamaraev ◽  
Anna M. Kiyutsevskaya
Keyword(s):  
Monetary Policy ◽  
Growth Rates ◽  
Financial Stability ◽  
World Economy ◽  
Inflation Targeting ◽  
Currency Crisis ◽  
Policy Regimes ◽  
Russian Economy ◽  
Consumer Prices ◽  
The World

The authors, analyzing features of realization of monetary policy under inflation targeting, show that its application and evolution are based on the objective reasons related to a decrease of consumer prices growth rates all over the world and an increase of the integration of the world economy. It led to the ineffectiveness of other monetary policy regimes in open economies. It is true also for the Russian economy that has passed the way from financial mechanisms of centralized economy to inflation targeting. Its approaches and instruments have been adjusted in accordance with Russian realities. The authors show that application of inflation targeting regime in Russia along with other measures of macroeconomic policy have become one of the elements of the system of maintaining financial stability after the 2014 currency crisis.

scholarly journals Exchange Rate Pass-Through to Import Prices, Inflation and Monetary Policy in Nigeria

2015 ◽  
Vol 2 (1) ◽  
pp. 60 ◽  
Author(s):  
M. O. Fatai ◽  
T. O. Akinbobola
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Impulse Response Function ◽  
Exchange Rate Policy ◽  
Annual Data ◽  
Import Prices ◽  
The World ◽  
Pass Through ◽  
Exchange Rate Pass Through ◽  
The Impact

The study investigates the impact of Exchange Rate Pass-through (ERPT) to import prices, Inflation, and monetary policy in Nigeria. Secondary data were used. The data covered the period of 1986-2012. Annual data on Nominal Effective Exchange Rate Index (NEER), Import Prices (IMP), Interest Rate (ITR), Money Supply (MS) and Inflation (INF) were sourced from the publication of the Central Bank of Nigeria (CBN) and Oil Price Index (OPI) were sourced from the World Development Indicators (WDI) published by the World Bank. The study applied Six-Variable VAR Model to estimate the Impulse Response Function (IRFs) and Variance Decomposition (VDCs). Based on SVAR analysis the study found that ERPT in Nigeria during the period under review is moderate, significant and persistent in the case of import prices and low and short lived in the case of inflation. The fact is that, ERPT was found to be incomplete and has useful implication to policymakers, especially in the design and implementation of exchange rate and monetary policy. Thus policy makers should take into account the incomplete response of import prices when they decide to devalue the currency so as to improve trade balance irrespective of several other factors which might determine the effectiveness of exchange rate policy (such as supply factors, elasticity of foreign and domestic demand, availability of substitutes etc ). To achieve this, the increased role of CBN will definitely require a carefully developed monetary policy and a strengthening of its institutional capacity. 

The World Economy

1996 ◽  
Vol 157 ◽  
pp. 28-57
Author(s):  
Ray Barrell ◽  
Julian Morgan ◽  
Nigel Pain
Keyword(s):  
Monetary Policy ◽  
Exchange Rate ◽  
Interest Rates ◽  
Risk Premium ◽  
World Economy ◽  
Significant Risk ◽  
Short Term ◽  
Spare Capacity ◽  
The Us ◽  
The World

It is now quite clear that growth slowed in Europe around the end of 1995, and that it remained low in the first quarter of 1996. However, the most recent information suggests that the slowdown is likely to prove temporary. Early indicators for the second quarter suggest that growth has begun to accelerate, much in line with our forecast published in May. We have made no further adjustment to our forecast for EU wide growth this year, with output still expected to rise by around 1½ per cent this year and around 2¾–3 per cent next year. Recent exchange rate developments should help support demand, as the D-mark, the French franc and other currencies within the D-mark bloc have all depreciated against the dollar in the last few months. A number of economies in Europe appear to have some spare capacity, and can increase output, whilst the US is operating at or above capacity, and a reduction in demand should ease incipient inflationary pressures rather more than it reduces output. The depreciation of the D-mark has been associated with a loosening of monetary policy, with short-term interest rates in Germany being a full point lower than they were a year ago. French short-term interest rates have fallen much more, reflecting the disappearance of a significant risk premium last year. The loosening of policy was timely, and should help offset the deflationary pressures that have come from a slowdown in stock accumulation in both France and Germany and from low investment, especially in Germany.

scholarly journals THE IMPACT OF CRUDE PALM OIL PRICE ON RUPIAH’S RATE

2014 ◽  
Vol 16 (4) ◽  
pp. 295-314
Author(s):  
Hilda Aprina
Keyword(s):  
Exchange Rate ◽  
Real Exchange Rate ◽  
Palm Oil ◽  
Exchange Rate Regime ◽  
Simultaneous Equation ◽  
Equation Model ◽  
Crude Palm Oil ◽  
The World ◽  
The Stability ◽  
The Impact

Indonesia is a largest producer of Crude Palm Oil in the world, with increasing production and export from time to time. Since Indonesia now adopts a floating exchange rate regime, the export of such commodity may influence the real exchange rate, and this is the aim of this paper. By applying simultaneous equation model on data from 1984 to 2011, we conclude that the increase in CPO price will lead to an appreciation of Rupiah’s real exchange rate. As a major producer of CPO, the authority should be able to control the world price of crude palm oil to help controlling the stability of Rupiah’s rate. Keywords: CPO, simultaneous equation, real exchange rate.JEL Classification: E2

scholarly journals Informatization of global economic development and place of Ukraine in the information environment

2019 ◽  
Keyword(s):  
Economic Development ◽  
Information And Communication Technologies ◽  
Global Economy ◽  
World Economy ◽  
Communication Technologies ◽  
Global Market ◽  
Development Index ◽  
The World ◽  
Information And Communication ◽  
The Impact

This publication studies the impact of information and communication technologies on the global economy; using the main Indices (Network Readiness Index, Global Innovation Index, E-Government Development Index, E-Participation Index and ICT Development Index) the authors analyzed at a on information society development. Information and communication technologies are an integral part of the global economy; the decisive factor of the country's economic development is the level of ICT use in various areas of public life. The fact of the transition from the “old industrial order” to the “new economy”, which affects the processes of production, processing and transmission of information, transforming the economy, politics and culture in the modern world, becomes obvious. The rapid development and spread of new ICT technologies acquire the nature of the global information revolution. This leads to an irreversible transformation into a new post-industrial type of society. The main idea of this research is relevant within the scientific and practical terms. The subject of the research is the informatization of global economic development. The purpose of the research is to study informatization processes and to analyze ICT as a resource of the modern development of the world economy. The object of the study is the dynamics of the informatization process development and the detailed analysis of the impact of ICT on the world economy. The scientific methods are a system analysis, a factor analysis and a graphical method. The study reveals new components of the world economy and countries’ positions on the global market. The authors conclude that due to the development of ICT, almost all areas of the economy, which have an impact on the development of states and people's welfare, are getting intensified.

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