Asian Monetary Unit (AMU) as a Surveillance Indicators for Regional Monetary Cooperation

Journal of International Commerce, Economics and Policy (JICEP), World Scientific, 2011

Posted: 22 Aug 2011

See all articles by Eiji Ogawa

Eiji Ogawa

Hitotsubashi University; Research Institute of Economy, Trade and Industry (RIETI)

Junko Shimizu

Senshu University - Faculty of Commerce

Date Written: June 1, 2011

Abstract

Ogawa and Shimizu (2005) proposed an Asian Monetary Unit (AMU), which is a common currency basket composed of ASEAN plus three Asian currencies, and AMU Deviation Indicators (AMU DIs), which indicates deviations of each Asian currency in terms of the AMU compared to the benchmark rate. In this paper, we use daily and monthly data of AMU and AMU DIs to examine their usefulness as a surveillance indicator for monetary cooperation in Asia. We find that an AMU peg system stabilizes the trade-weighted exchange rates within Asia and that AMU DIs warn of misalignments of and between Asia currencies.

Keywords: Regional monetary cooperation, common currency basket, Asian Monetary Unit (AMU)

Suggested Citation

Ogawa, Eiji and Shimizu, Junko, Asian Monetary Unit (AMU) as a Surveillance Indicators for Regional Monetary Cooperation (June 1, 2011). Journal of International Commerce, Economics and Policy (JICEP), World Scientific, 2011. Available at SSRN: https://ssrn.com/abstract=1914029

Eiji Ogawa (Contact Author)

Hitotsubashi University ( email )

2-1 Naka Kunitachi-shi
Tokyo 186-8601
Japan

Research Institute of Economy, Trade and Industry (RIETI) ( email )

1-3-1 Kasumigaseki
Chiyoda-ku
Tokyo 100-8901
Japan

Junko Shimizu

Senshu University - Faculty of Commerce ( email )

2-1-1, Higashi-mita, Tama-ku, Kawasaki-shi
Kanagawa 214-8580
Japan

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