全球智库信息集成服务系统(G2TT): DP12850 Exchange Rate Misalignment, Capital Flows, and Optimal Monetary Policy Trade-offs

G2TT

来源类型	Discussion paper
规范类型	论文
来源ID	DP12850
	DP12850 Exchange Rate Misalignment, Capital Flows, and Optimal Monetary Policy Trade-offs
	Giancarlo Corsetti; Luca Dedola; Sylvain Leduc
发表日期	2018-04-08
出版年	2018
语种	英语
摘要	What determines the optimal monetary trade-off between internal objectives (inflation, and output gap) and external objectives (competitiveness and trade imbalances) when inefficient capital flows cause exchange rate misalignment and distort current account positions? We characterize this trade-off analytically, using the workhorse model of modern monetary theory in open economies under incomplete markets–where inefficient capital flows and exchange rate misalignments can arise independently of nominal distortions. We derive a quadratic approximation of the utility-based global policy loss function under fairly general assumptions on preferences and openness, and solve for the optimal targeting rules under co- operation. We show that, in economies with a low degree of exchange rate pass-through, the optimal response to inefficient capital inflows associated with real appreciation is contractionary, above and beyond the natural rate: the optimal policy curbs excessive demand at the cost of exacerbating currency overvaluation. In contrast, a high degree of pass-through, and/or low trade elasticities, warrants expansionary policies that lean against exchange rate appreciation and competitive losses, at the cost of inefficient inflation.
主题	International Macroeconomics and Finance
关键词	Currency misalignments Trade imbalances Asset markets and risk sharing Optimal targeting rules International policy cooperation Exchange rate pass-through
URL	https://cepr.org/publications/dp12850
来源智库	Centre for Economic Policy Research (United Kingdom)
资源类型	智库出版物
条目标识符	http://119.78.100.153/handle/2XGU8XDN/541660
推荐引用方式 GB/T 7714	Giancarlo Corsetti,Luca Dedola,Sylvain Leduc. DP12850 Exchange Rate Misalignment, Capital Flows, and Optimal Monetary Policy Trade-offs. 2018.