Aizenman, Joshua; Glick, Reuven - Federal Reserve Bank of San Francisco - 2008
confers gains in anti-inflation credibility, but
ultimately results in an exit from the peg occasioned by a big enough … inflation. In this case hoarding a unit of foreign
reserves reduces domestic assets held by the central bank by more than one … increase in the extent of sterilization across countries may have a common
component.
Sterilization and Inflation
Table …