Foreign Exchange Intervention and Reserve Accumulation in an Emerging Market Economy: Selected Issues

18 Pages Posted: 13 Dec 2019

See all articles by Horacio Aguirre

Horacio Aguirre

Central Bank of Argentina

Gustavo Cañonero

affiliation not provided to SSRN

Mario Torriani

Central Bank of Argentina

Date Written: October 31, 2019

Abstract

The exchange rate plays a substantial role in the monetary and financial stability frameworks of emerging market economies. We look at the motivation behind foreign exchange intervention, including a thin foreign exchange market, high passthrough and foreign exchange as a determinant of inflation expectations. We examine how these features are reflected in the design of the new monetary regime in Argentina. Finally, we look at how reserve management policy can also incorporate the particular shocks faced by the economy.

Full Publication: Reserve Management and FX Intervention

Keywords: monetary policy, foreign exchange, reserve management

JEL Classification: E58, F31, G11

Suggested Citation

Aguirre, Horacio and Cañonero, Gustavo and Torriani, Mario, Foreign Exchange Intervention and Reserve Accumulation in an Emerging Market Economy: Selected Issues (October 31, 2019). BIS Paper No. 104d, Available at SSRN: https://ssrn.com/abstract=3497876

Horacio Aguirre (Contact Author)

Central Bank of Argentina ( email )

Reconquista 266
Edificio Central, piso 7
Buenos Aires, 1003
United States

Gustavo Cañonero

affiliation not provided to SSRN

Mario Torriani

Central Bank of Argentina

Reconquista 266
Edificio Central, piso 7
Buenos Aires, 1003
United States

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