scholarly journals The Effectiveness of Indicators of Financial Discipline in Strengthening the Exchange Rate, with a Special Reference to Iraq

2021 ◽  
Vol 27 (130) ◽  
pp. 118-141
Author(s):  
Karrar Mahdi Fenjan ◽  
Muhammad Saleh Salman
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Central Bank ◽  
Foreign Currency ◽  
Public Expenditures ◽  
Public Budget ◽  
Negative Effects ◽  
The Public ◽  
The Exchange Rate ◽  
The Government

Controlling public expenditures is one of the main objectives of the public budget. The public budget often suffers from a deficit, whether in developed or developing countries, because expenditures are usually greater than the revenues generated. This requires the existence of financial rules that are adhered to by the government, which in turn leads to discipline. Fiscal policy leads to a reduction in the obligations incumbent on the government.  Adhering to the financial rules would correct the course of fiscal policy in Iraq, with the need to direct oil revenues in the years of financial abundance when global oil prices rise to sovereign funds similar to other rentier countries, which contributes to maintaining the stability of the exchange rate and reducing dependence on The Central Bank. It performs monetary sterilization operations to sterilize the negative effects resulting from the lack of fiscal policy discipline, which negatively affects the foreign currency reserves and depletes them. The main conclusion reached by the research is that there is a state of financial indiscipline that has negatively affected the Iraqi dinar exchange rate, and that the attempts of the Central Bank of Iraq have partially worked to reduce the negative effects of the expansionary financial policy, and the main recommendation of the research was to work to achieve more discipline in fiscal policy in order to reduce the state of economic instability and mitigate the monetary sterilization policy by The Central Bank and the accompanying depletion of hard currency

scholarly journals Inflation in Nigeria: Possible determinants and remedies to tackle it in Nigeria

2016 ◽  
Vol 6 (2) ◽  
pp. 35-43
Author(s):  
Godly Otto ◽  
Wilfred Isioma Ukpere
Keyword(s):  
Economic Theory ◽  
Exchange Rate ◽  
Private Sector ◽  
Central Bank ◽  
Social Infrastructure ◽  
The Public ◽  
Demand Pull ◽  
Cost Of Production ◽  
The Exchange Rate

The previous Governor of the Central Bank of Nigeria (CBN) had intended to introduce the N5,000.00 currency bill into the Nigerian economy and claimed that such currency bill would help it manage the exchange rate especially against the dollar. This generated a huge outcry from the public especially economists. The major reason was that this introduction would generate inflation and also because the policy ran counter to the cash-less policy of the Central Bank of Nigeria. But to the Central Bank, there was no economic theory to suggest a currency redenomination could cause inflation. This debate once more threw up a need to reexamine the determinants of inflation in Nigeria. Generally, inflation could be cost push or demand pull but what drives the demand or informs cost quite often differ from one economy to another. This study examined the factors responsible for increasing cost of production and spending behaviour in Nigeria. It was able to identify 13 factors that impact on inflation. However, the degree of impact of each factor is left for another study. The study recommends that government should concentrate on providing social infrastructure that would encourage the private sector to invest and expand output, taking advantage of existing unemployed resources. This would help to stem inflation in Nigeria which is usually caused by scarcity.

Accounting and Auditing of Assets and Liabilities Used When Conducting Business Abroad

Auditor ◽  
2020 ◽  
Vol 6 (10) ◽  
pp. 17-24
Author(s):  
Yuriy Kochinev ◽  
Natalia Neelova ◽  
O. Sobol'
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Russian Federation ◽  
Foreign Currency ◽  
The Russian Federation ◽  
The Exchange Rate ◽  
The Difference ◽  
Foreign Assets

The relevance of the topic is due to changes in PBU 3/2006 "Accounting for assets and liabilities denominated in foreign currency", according to which, from 01.01.2019, all assets and liabilities denominated in foreign currency used by an organization to conduct business outside the Russian Federation are subject to conversion into rubles at the exchange rate of the Central Bank of the Russian Federation on the reporting date for the purpose of accounting. This raises the question of the mechanism of the difference arising from the results of recalculation of the value of foreign assets and liabilities, and its reflection in accounting. In the work proposed and illustrated by examples of recommendations to address the above-mentioned difference in specially designed for this purpose, the register. It also provides recommendations on accounting for transactions with non-monetary items used in activities outside the Russian Federation, expressed in rubles.

Central-Bank ‘Distress’ and Hyperinflation in Argentina, 1989–90

1995 ◽  
Vol 27 (3) ◽  
pp. 663-682 ◽  
Author(s):  
Paul Beckerman
Keyword(s):  
Exchange Rate ◽  
Public Sector ◽  
Central Bank ◽  
Financial Markets ◽  
Interest Rates ◽  
Monetary Policies ◽  
The Public ◽  
Domestic Debt ◽  
Outstanding Debt ◽  
The Government

AbstractThe essential explanation of Argentina's 1989 hyperinflations is that the stabilisation programmes immediately preceding them drove the public sector in particular, the central bank – into ‘debt distress.’ These stabilisation programmes sought to anchor prices on an appreciated exchange rate, sustained by tight monetary policies that maintained high interest rates. The problem was that the government and the central bank had heavy domestic-debt burdens, and their combined interest bill far exceeded their non-interest surplus. To finance the interest without creating money, the government and central bank had to add continually to the outstanding debt stock as they capitalised the interest due. The debt swelled, and interest rates were pressured upward. Heavy pressure against the exchange rate, devaluation and hyperinflation then ensued when the public-sector debt stock exceeded what financial markets could be persuaded to hold at reasonable interest rates.

The Foreign Currency Exchange Rate Policy Up Until 1986

2020 ◽  
pp. 209-229
Author(s):  
Einar Lie
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Foreign Currency ◽  
Exchange Rate Regime ◽  
Exchange Rate Policy ◽  
International Exchange ◽  
Currency Exchange ◽  
Currency Exchange Rate ◽  
Rate Policy ◽  
The Government

This chapter studies how Norges Bank came to play a central, technical role in maintaining and defending a stable krone exchange rate during the years 1946–86. This role was reflected in how the bank advised on the basis of a loyal position to the fixed krone exchange rate regime and to binding international exchange rate cooperation. In 1978, Norway backed out of the European fixed exchange rate cooperation, and during 1976–86, the krone was devalued ten times. Even though Norges Bank officially came to contribute to both recommending and carrying out this policy, the policy defied the strong ideals and viewpoints of the organization. The exchange rate policy, and the problems it led to in relation to the central bank, caused the government, in the first half of the 1980s, to push Norges Bank completely aside when it came to the shaping of Norwegian exchange rate policy. Nevertheless, much of the policy was still shaped inside the walls of the institution.

Mobile Capital, Domestic Institutions, and Electorally Induced Monetary and Fiscal Policy

2000 ◽  
Vol 94 (2) ◽  
pp. 323-346 ◽  
Author(s):  
William Roberts Clark ◽  
Mark Hallerberg
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Central Bank ◽  
Open Economy ◽  
Capital Mobility ◽  
Formal Model ◽  
Central Bank Independence ◽  
Mobile Capital ◽  
The Exchange Rate ◽  
Monetary And Fiscal Policy

The literature on global integration and national policy autonomy often ignores a central result from open economy macroeconomics: Capital mobility constrains monetary policy when the exchange rate is fixed and fiscal policy when the exchange rate is flexible. Similarly, examinations of the electoral determinants of monetary and fiscal policy typically ignore international pressures altogether. We develop a formal model to analyze the interaction between fiscal and monetary policymakers under various exchange rate regimes and the degrees of central bank independence. We test the model using data from OECD countries. We find evidence that preelectoral monetary expansions occur only when the exchange rate is flexible and central bank independence is low; preelectoral fiscal expansions occur when the exchange rate is fixed. We then explore the implications of our model for arguments that emphasize the partisan sources of macroeconomic policy and for the conduct of fiscal policy after economic and monetary union in Europe.

scholarly journals Analysis of the Effects of Public Expenditure on Agricultural Growth in Mali

2021 ◽  
pp. 42-50
Author(s):  
Abdoulaye Maïga ◽  
Amadou Bamba ◽  
Boubacar Sy ◽  
Georges Hady Keita ◽  
Issoufou Soumaïla Mouleye ◽  
...  
Keyword(s):  
Agricultural Sector ◽  
Descriptive Analysis ◽  
Public Expenditures ◽  
Negative Effects ◽  
Specification Tests ◽  
Allocation Policy ◽  
Agricultural Growth ◽  
The Public ◽  
The Government ◽  
Using Data

The objective of this study is to analyze the effects of government spending on agricultural growth in Mali using data from 2000 to 2019. The lagged autoregressive model (ARDL) was used to perform the estimation. We conducted a descriptive analysis of the data from the World Bank database. Several specification tests were performed to confirm the validity of the chosen model. The results of this study show that the public expenditures have positive and significant effects on agricultural growth, except for agricultural expenditures that have negative effects. Similarly, the agricultural employability rate and fertilizer consumption also have negative effects. This implies that the government needs to review its resource allocation policy in all sectors, including the agricultural sector.

scholarly journals Sectorial growth, Exchange rate and Fiscal policy in Developing Economies: The Interlinkages

2019 ◽  
Vol 1 (2) ◽  
pp. 68-81
Author(s):  
Snober Fazal ◽  
Muhammad Azhar Bhatti ◽  
Tusawar Iftikhar Ahmad
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Service Sector ◽  
Developing Economies ◽  
Government Expenditure ◽  
Simultaneous Equation ◽  
Positive Relation ◽  
Sectoral Growth ◽  
The Exchange Rate ◽  
The Government

The study examined the interdependence of sectorial growth, exchange rate and fiscal policy by simultaneous equation model for 50 developing economies over the time period of 2000 to 2014. Industrial GDP, service sector GDP, exchange rate, tax revenue are endogenous variables, while capital formation, foreign direct investment, trade, inflation, foreign aid, external debt and money supply are instruments. The study has 4 system of equations and estimated by simultaneous equations models (SEMs) through three-stage least squares (3SLS) estimator presented by (Zellner & Theil, 1962), the result of the study indicates that sectorial growth and fiscal policy have positive relation because tax exemption or reduction generate great impact on sectoral growth. Sectorial growth and exchange rate have a positive relation. The study also indicates that the exchange rate and fiscal policy are negatively related. An increase in government expenditure (spending) shows a decrease in the exchange rate. So the government of developing economies should increase revenues from non-tax sources instead of taxes, an increase in taxes decrease the exchange rate and ultimately increased in the sectoral growth.

التأثيرات السياسية في استدامة الدين العام في موازنة العراق 2019

2020 ◽  
Vol 2020 (66) ◽  
pp. 1-26
Author(s):  
م.م أحمد حامد جمعة ◽  
◽  
د. كمال فيلد البصري
Keyword(s):  
Public Debt ◽  
Public Spending ◽  
The Political ◽  
Financial Policy ◽  
Public Expenditures ◽  
Public Budget ◽  
Political Decision ◽  
The Public ◽  
Public Benefit ◽  
Political Impact

This study clarifies the analysis of the reality of the financial policy in the budget of Iraq 2019, and that analysis is evaluated by tracking the elements of the public budget from public expenditures and public revenues, and the study focuses on the size of the political impact on the path of public spending, as well as the analysis of public spending and revenues in various sectors and sections of the public budget. This study also shows the size of the risks resulting from the continuation of the financial deficit, as well as the risks of public debt according to the indicators of its sustainability analysis within the financial and economic indicators that express the risks of public debt. The study emphasized that public spending is still based on the political decision and does not achieve the principles and objectives of the economic budget that achieve the public benefit. The necessity requires efficient spending and fair distribution in order to avoid future public debt risks and their impact on future generations

Features of payments in foreign currency in budgetary institutions

2020 ◽  
pp. 19-28
Author(s):  
Larisa Gerasimova
Keyword(s):  
Exchange Rate ◽  
Foreign Currency ◽  
Fair Value ◽  
Budgetary Institutions ◽  
The Exchange Rate ◽  
Monetary Assets ◽  
Made In

The article discusses the procedure for accounting for objects in a foreign currency. It is shown that foreign currency assets, liabilities, and other items are recorded simultaneously in foreign currency and in rubles. Analyzed the accounting treatment of exchange rate differences, it is shown that their records depend on the period. Examples of currency monetary and non-monetary accounting items and the specifics of their reflection in accounting transactions are given. Monetary assets and liabilities are recorded at the exchange rate at the date of recognition. The option of recognition at the reporting date is possible. Non-monetary assets and liabilities are recognized at the date of recognition and are no longer restated. An example of accounting for non-monetary assets accepted by an institution at fair value as an exception to their rules is given. The article reflects that the revaluation of such assets at the new exchange rate is made in cases when the fair value of the object changes. It shows the mechanisms for accounting for the return of advances in foreign currency and options when such debt is recalculated or not recalculated after being accepted for accounting.

scholarly journals A Theory of Foreign Exchange Interventions

2021 ◽  
Author(s):  
Sebastián Fanelli ◽  
Ludwig Straub
Keyword(s):  
Exchange Rate ◽  
Central Bank ◽  
Interest Rates ◽  
Open Economy ◽  
Small Open Economy ◽  
Bond Markets ◽  
Pecuniary Externality ◽  
Optimal Intervention ◽  
The Exchange Rate ◽  
Intervention Policy

Abstract We study a real small open economy with two key ingredients (1) partial segmentation of home and foreign bond markets and (2) a pecuniary externality that makes the real exchange rate excessively volatile in response to capital flows. Partial segmentation implies that, by intervening in the bond markets, the central bank can affect the exchange rate and the spread between home- and foreign-bond yields. Such interventions allow the central bank to address the pecuniary externality, but they are also costly, as foreigners make carry trade profits. We analytically characterize the optimal intervention policy that solves this trade-off: (1) the optimal policy leans against the wind, stabilizing the exchange rate; (2) it involves smooth spreads but allows exchange rates to jump; (3) it partly relies on “forward guidance,” with non-zero interventions even after the shock has subsided; (4) it requires credibility, in that central banks do not intervene without commitment. Finally, we shed light on the global consequences of widespread interventions, using a multi-country extension of our model. We find that, left to themselves, countries over-accumulate reserves, reducing welfare and leading to inefficiently low world interest rates.

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