scholarly journals Angola

2019 ◽  
Vol 19 (170) ◽  
pp. 1
Author(s):  
Keyword(s):  
Exchange Rate ◽  
Current Account ◽  
Current Account Deficit ◽  
Exchange Rate Regime ◽  
Oil Prices ◽  
Flexible Exchange Rate ◽  
Policy Response ◽  
Growth Recovery ◽  
Alternative Sources ◽  
Oil Revenues

A 36-month Extended Arrangement under the Extended Fund Facility (hereafter the “arrangement”) was approved last December, with access of SDR 2,673 million (361 percent of quota). Lower international oil prices would reduce oil revenues, widen the current account deficit, and stymie growth recovery. The authorities are implementing a proper policy response to the weakened outlook, through a conservative supplementary budget for 2019, alternative sources of cheaper financing, and progress toward a more flexible exchange rate regime.

scholarly journals Exchange Rate Misalignment And Current Account Sustainability: The Australian Experience

2011 ◽  
Vol 2 (3) ◽  
Author(s):  
Francois Hermet ◽  
Jean-Francois Hoarau ◽  
Alain Nurbel
Keyword(s):  
Exchange Rate ◽  
Current Account ◽  
Current Account Deficit ◽  
Exchange Rate Regime ◽  
Flexible Exchange Rate ◽  
Real Effective Exchange Rate ◽  
Current Account Sustainability ◽  
Effective Exchange ◽  
Australian Experience ◽  
The Current Account

Australia’s persistent current account deficit engenders lively debates about its intertemporal solvency. This paper aims at showing whether there is really a misalignment of the $A real effective exchange rate ($A REER) and, if it is the case, at wondering about its real influence on the current account of Australia. The estimation of our empirical model puts forward a misalignment of the $A REER, but at the same time allows to emphasise the reduction in the magnitude of the misalignment since the adoption of the flexible exchange rate regime. Adding the stabilisation of the current account deficit, although recurrent, results in lending support to the Australian current account sustainability commonly held view.

Negotiating the Trilemma: The Indian Experience

2012 ◽  
Vol 12 (1) ◽  
pp. 1850249 ◽  
Author(s):  
Abhijit Sen Gupta ◽  
Ganesh Manjhi
Keyword(s):  
Exchange Rate ◽  
Capital Flows ◽  
Current Account Deficit ◽  
Exchange Rate Regime ◽  
Flexible Exchange Rate ◽  
Active Management ◽  
Reserve Bank ◽  
Indian Experience ◽  
Policy Objectives ◽  
Healthy Growth

Increased integration with the global capital markets in recent years has forced India to negotiate the trilemma, balancing the objectives of monetary independence, exchange rate stability, and orderly capital flows. India’s calibrated approach towards liberalization of capital account, wherein certain flows and agents were accorded priority in the liberalization process, has helped India to deal with the trilemma. In this paper, we examine India’s experience in negotiating the trilemma during the last three decades. In doing so, we deviate from the existing literature by quantifying the various policy objectives under the trilemma. This allows us to analyze the extent to which pursuit of an objective has entailed giving up two other objectives. Using empirical methods, we find that India has been constrained by the trilemma during the last three decades. However, instead of adopting corner solutions, India has juggled the various policy objectives under the trilemma as per the demands of the macroeconomic situation. The overall policy architecture encompassed active management of capital flows, especially volatile flows and debt flows, a moderately flexible exchange rate regime with the Reserve Bank of India (RBI) intervening at times to prevent excessive volatility, sterilization of these interventions through multiple instruments, and building up of a stockpile of reserves. This intermediate approach has suited India well as it has been able to maintain a healthy growth rate, targeted monetary and credit growth rates, a moderate inflation rate through most of the period, and a sustainable current account deficit.

scholarly journals Current Account Dynamics, Adjustment and Capital Mobility in Bangladesh

2013 ◽  
Vol 2 (2) ◽  
pp. 117-126
Author(s):  
Mohammad Masud Alam ◽  
Rezai Karim Khondker ◽  
Mohammad Shahansha Molla
Keyword(s):  
Exchange Rate ◽  
Current Account ◽  
Capital Market ◽  
Capital Mobility ◽  
Market Integration ◽  
Exchange Rate Regime ◽  
Flexible Exchange Rate ◽  
Policy Implications ◽  
Current Account Dynamics ◽  
Real Shocks

This paper examines current account (CA) dynamics, its relationship with the degree of capital mobility and the state of integration of the Bangladesh capital market with the global capital market. For the period 1976-2012, findings of AR (1) process shows a rigid CA position along with its slow adjustment and its inflexibility against real shocks, lower degree of capital mobility and a slow progress of capital market integration with the rest of the world. Compared to the period of fixed exchange rate regime, lesser degree of  rigidity has been observed during the flexible exchange rate period suggesting a smooth and flexible current account position; but shows an increased degree of rigidity and capital immobility for the overall time period under consideration. These findings reveal some important policy implications in respects of current and capital account liberalization, deregulation of domestic markets and removing entry barriers on the part of Bangladesh to boost up FDI and remittance inflows.  

scholarly journals Determining the Real Exchange Rate Equilibrium for Pakistan

2021 ◽  
Vol 19 (1) ◽  
Keyword(s):  
Exchange Rate ◽  
Current Account Deficit ◽  
Exchange Rate Regime ◽  
Flexible Exchange Rate ◽  
Real Effective Exchange Rate ◽  
Reduced Form ◽  
High Volatility ◽  
Effective Exchange ◽  
Relative Productivity ◽  
Effective Exchange Rate

The achievement of macroeconomic stability and sustained economic growth are the main targets of macroeconomic agents and policymakers. High volatility in Real Effective Exchange Rate (REER) is noticed while moving towards flexible Exchange rate regime. Three assessment methodologies are followed in the paper i.e. PPP approach, PPP approach adjusted for Penn effect and reduced form equation approach to gauge REER misalignment. VAR modelling suggest that, PPP holds for Pakistan and Penn effect is witnessed in the country for FY1980-FY12018. The determinants of REER, like “openness to GDP ratio, Govt consumption to GDP ratio, Long term Investment to GDP ratio, relative productivity and terms of trade” are responsible for depreciation in REER. While, worker remittances and FDI leads towards the REER appreciation in. It is indispensable to opt for the devaluation of PKR to gain export competitiveness, which may result in shrinkage of current account deficit. To increase the productivity of tradable items and to reduce the GOVT consumption of imported items are few steps to push REER towards equilibrium level. As per the state of art model the range of misalignment in REER is from -3.9% to 4.2% in Pakistan.

scholarly journals FLEKSIBILITAS NILAI TUKAR DAN PENYESUAIAN TRANSAKSI BERJALAN DI INDONESIA: ANALISIS THRESHOLD VAR

2018 ◽  
Vol 4 (2) ◽  
pp. 112-139
Author(s):  
Farhana Zahrotunnisa ◽  
Iman Sugema ◽  
Toni Bakhtiar
Keyword(s):  
Exchange Rate ◽  
Current Account ◽  
Current Account Deficit ◽  
Exchange Rate Regime ◽  
Exchange Rate Flexibility ◽  
Exchange Rate Variability ◽  
Monetary Authorities ◽  
Actual Exchange ◽  
The Relationship ◽  
Current Account Adjustment

Estimation study about the relationship between exchange rate flexibility and current account adjustment has been through three stages, the first stage was analysis of correlation among exchange rates variability (proxied by REER and NEER) and exchange rate regimes classification. The second step was estimating the relationship that the former was mentioned with VAR as benchmark model. The third step was applying the nonlinear estimation with Threshold VAR. The results of analysis showed that exchange rate regime classification may not capture actual exchange rate variability and flexibility exchange rate can accelerate current account adjustment in Indonesia if the changes of Indonesia exchange rate less than 27.7059 (low regime) whereas in high regime exchange rate is persistent increasing so that the system between exchange rate and current account become unstable. Bank Indonesia as monetary authorities must keep the changes of exchange rate less than 27.7059, due to exchange rate can affect current account adjustment, so can anticipate if there is current account deficit in Indonesia economy.  Keywords : Exchange Rate Flexibility, Current Account Adjustment, Exchange Rate Regime, Classification, Threshold VAR

scholarly journals FLEKSIBILITAS NILAI TUKAR DAN PENYESUAIAN TRANSAKSI BERJALAN DI INDONESIA: ANALISIS THRESHOLD VAR

2018 ◽  
Vol 4 (2) ◽  
pp. 112-139
Author(s):  
Farhana Zahrotunnisa ◽  
Iman Sugema ◽  
Toni Bakhtiar
Keyword(s):  
Exchange Rate ◽  
Current Account ◽  
Current Account Deficit ◽  
Exchange Rate Regime ◽  
Exchange Rate Flexibility ◽  
Exchange Rate Variability ◽  
Monetary Authorities ◽  
Actual Exchange ◽  
The Relationship ◽  
Current Account Adjustment

Estimation study about the relationship between exchange rate flexibility and current account adjustment has been through three stages, the first stage was analysis of correlation among exchange rates variability (proxied by REER and NEER) and exchange rate regimes classification. The second step was estimating the relationship that the former was mentioned with VAR as benchmark model. The third step was applying the nonlinear estimation with Threshold VAR. The results of analysis showed that exchange rate regime classification may not capture actual exchange rate variability and flexibility exchange rate can accelerate current account adjustment in Indonesia if the changes of Indonesia exchange rate less than 27.7059 (low regime) whereas in high regime exchange rate is persistent increasing so that the system between exchange rate and current account become unstable. Bank Indonesia as monetary authorities must keep the changes of exchange rate less than 27.7059, due to exchange rate can affect current account adjustment, so can anticipate if there is current account deficit in Indonesia economy.  Keywords : Exchange Rate Flexibility, Current Account Adjustment, Exchange Rate Regime, Classification, Threshold VAR

A General Trend Analysis of India’s Current Account Balance

2014 ◽  
Vol 1 (1) ◽  
Author(s):  
Phool Chand
Keyword(s):  
Exchange Rate ◽  
Current Account ◽  
General Trend ◽  
Exchange Rate Regime ◽  
Flexible Exchange Rate ◽  
Current Account Balance ◽  
Positive Growth ◽  
Major Shift ◽  
Merchandise Trade ◽  
Negative Growth

With economic liberalization in India, a major shift on the foreign exchange front was in the form of switching from a fixed exchange rate regime to flexible exchange rate regime. This shift led to some heavy and sudden fluctuations in the prices and volumes of exports and imports. The present study is an attempt to analyse the overall trends in India’s current account balance during the period 1970-71 to 2010-11. The analysis shows that merchandise trade did not play any role towards the improvements of current account balance. In fact, it deteriorated the current account balance during the time span of the study. On the other hand, invisibles as a whole showed a very small negative growth rate which in effect is negligible. Income head has led buoyancy to current account balance. The overall positive growth of current account balance is basically an indication of good management of current account balance.

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