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The Imbalances of the Bretton Woods System 1965 to 1973 : U.S. Inflation, the Elephant in the Room

Bordo, Michael D. - 2018

collapse of the Bretton Woods system between 1971 and 1973 was rising U.S. inflation since 1965. It was driven in turn by … imports and a ninety day wage price freeze—was that U.S. inflation, driven by macro policies, was the main problem facing the … Federal Reserve Chairman Arthur F. Burns, Nixon adopted wage and price controls to mask the inflation, hence punting the …

Persistent link: https://www.econbiz.de/10012906267

The Effects of U.S. Monetary Policy on Emerging Market Economies' Sovereign and Corporate Bond Markets

Burger, John D. - 2017

We analyze the effect of the US Federal Reserve's monetary policy on EME sovereign and corporate bond markets by focusing on two dimensions: the evolution of the structure (size and currency composition) of the bond markets and their allocations within the bond portfolios of US investors. Global...

Persistent link: https://www.econbiz.de/10012950839

Global Financial Cycles and Risk Premiums

Jordà, Òscar - 2018

This paper studies the synchronization of financial cycles across 17 advanced economies over the past 150 years. The comovement in credit, house prices, and equity prices has reached historical highs in the past three decades. The sharp increase in the comovement of global equity markets is...

Persistent link: https://www.econbiz.de/10012916914

Post Covid-19 Exit Strategies and Emerging Markets Economic Challenges

Aizenman, Joshua; Itō, Hiro - 2021

We outline two divergent exit strategies of the U.S. from the post COVID-19 debt-overhang, and analyze their implications on Emerging Markets and global stability. The first strategy is the U.S. aiming at returning to the 2019, pre-COVID mode of loose fiscal policy and accommodating monetary...

Persistent link: https://www.econbiz.de/10013225833

U.S. Monetary Policy and Emerging Market Credit Cycles

Bräuning, Falk - 2018

Foreign banks' lending to firms in emerging market economies (EMEs) is large and denominated predominantly in U.S. dollars. This creates a direct connection between U.S. monetary policy and EME credit cycles. We estimate that over a typical U.S. monetary easing cycle, EME borrowers experience a...

Persistent link: https://www.econbiz.de/10012909113

U.S. Monetary Policy and International Risk Spillovers

Kalemli-Özcan, Ṣebnem - 2019

I show that monetary policy divergence vis-a-vis the U.S. has larger spillover effects in emerging markets than advanced economies. The monetary policy of the U.S. affects domestic credit costs in other countries through its effect on global investors' risk perceptions. Capital flows in and out...

Persistent link: https://www.econbiz.de/10012862411

On the Global Impact of Risk-Off Shocks and Policy-Put Frameworks

Caballero, Ricardo J. - 2019

Global risk-off shocks can be highly destabilizing for financial markets and, absent an adequate policy response, may trigger severe recessions. Policy responses were more complex for developed economies with very low interest rates after the Global Financial Crisis (GFC). We document, however,...

Persistent link: https://www.econbiz.de/10012867100

Monetary Policy and the Predictability of Nominal Exchange Rates

Eichenbaum, Martin S. - 2017

inflation rates in shaping the response of real exchange rates to shocks. We document two facts about inflation … rate is a poor predictor of future inflation rates. We estimate a medium-size DSGE open-economy model that accounts … that accounts for the dynamics of exchange rates and their covariance with inflation are disturbances to the foreign demand …

Persistent link: https://www.econbiz.de/10012963169

Monetary and Fiscal Policy with Flexible Exchange Rates

Branson, William H.; Buiter, Willem H. - 2021

usually have an effect on economic activity. It is however possible to find paths of money deceleration which reduce inflation …

Persistent link: https://www.econbiz.de/10013222993

Monetary Policy in the Open Economy Revisited : Price Setting and Exchange Rate Flexibility

Devereux, Michael B.; Engel, Charles - 2021

This paper develops a welfare-based model of monetary policy in an open economy. We focus on the extent to which monetary policy should be employed in maintaining the exchange rate. The traditional approach maintains that exchange rate flexibility is desirable in the presence of real...

Persistent link: https://www.econbiz.de/10013223870