Monetary Policy Transmission in Mauritius Using a VAR Analysis PDF Download
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Author: Mr.Charalambos G. Tsangarides
Publisher: International Monetary Fund
ISBN: 1451962789
Category : Business & Economics
Languages : en
Pages : 35
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Book Description
Applying commonly used vector autoregression (VAR) techniques, this paper investigates the transmission mechanism of monetary policy on output and prices for Mauritius, using data for 1999-2009. The results show that (i) an unexpected monetary policy tightening-an increase in the Bank of Mauritius policy interest rate-leads to a decline in prices and output but the effect on output is weaker; (ii) an unexpected decrease in the money supply or an unexpected increase in the nominal effective exchange rate result in a decrease in prices; and (iii) variations of the policy variables account for small a percentage of the fluctuations in output and prices. Taken together, these results suggest a rather weak monetary policy transmission mechanism. Finally, we find some differences in the transmission mechanism depending on whether core or headline consumer price index is used in the estimations.
Author: Mr.Charalambos G. Tsangarides
Publisher: International Monetary Fund
ISBN: 1451962789
Category : Business & Economics
Languages : en
Pages : 35
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Book Description
Applying commonly used vector autoregression (VAR) techniques, this paper investigates the transmission mechanism of monetary policy on output and prices for Mauritius, using data for 1999-2009. The results show that (i) an unexpected monetary policy tightening-an increase in the Bank of Mauritius policy interest rate-leads to a decline in prices and output but the effect on output is weaker; (ii) an unexpected decrease in the money supply or an unexpected increase in the nominal effective exchange rate result in a decrease in prices; and (iii) variations of the policy variables account for small a percentage of the fluctuations in output and prices. Taken together, these results suggest a rather weak monetary policy transmission mechanism. Finally, we find some differences in the transmission mechanism depending on whether core or headline consumer price index is used in the estimations.
Author: Mr.Luis Brandao-Marques
Publisher: International Monetary Fund
ISBN: 1513529730
Category : Business & Economics
Languages : en
Pages : 54
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Book Description
Central banks in emerging and developing economies (EMDEs) have been modernizing their monetary policy frameworks, often moving toward inflation targeting (IT). However, questions regarding the strength of monetary policy transmission from interest rates to inflation and output have often stalled progress. We conduct a novel empirical analysis using Jordà’s (2005) approach for 40 EMDEs to shed a light on monetary transmission in these countries. We find that interest rate hikes reduce output growth and inflation, once we explicitly account for the behavior of the exchange rate. Having a modern monetary policy framework—adopting IT and independent and transparent central banks—matters more for monetary transmission than financial development.
Author: Indranarain Ramlall
Publisher: Springer
ISBN: 3319394355
Category : Business & Economics
Languages : en
Pages : 473
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Book Description
This book offers a comprehensive assessment of the Mauritian economy and its financial system. The author investigates the pre- and post- crisis financial and economic environment of Mauritius thoroughly and looks to the future potential development of the economy. Chapters feature in-depth analysis of such aspects as the banking sector, the stock market, monetary policy, capital structure, the hedging practices of Mauritian firms, and the housing market in Mauritius, among others. Moreover, the author not only builds a credit risk model for Mauritian bankers, but also develops a financial stability model to provide the reader with a full account of the Mauritian economy. The author ends with a chapter dedicated to a 2030 vision for Mauritius. This book will be of interest to researchers, students, policy-makers, central bankers and economists who wish to explore an example of an upper-income developing economy in depth.
Author: International Monetary Fund. African Dept.
Publisher: International Monetary Fund
ISBN: 1484327438
Category : Business & Economics
Languages : en
Pages : 76
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Book Description
The article reviews Mauritius’ developments and its macroeconomic policies for the imminent years. Growth has been flexible in these years but the postglobal crisis period did not show any remarkable developments. The country was heavily dependent on European exports and vulnerable to external shocks. To undergo debt and external sustainability in 2014–15, the authorities are reframing fiscal and monetary policies, restructuring physical infrastructure policies, and pension and labor reforms. The control of excess of liquidity and improvement in national savings will pave the way to reduce inflation pressures and external imbalances.
Author: Thomas Kigabo Rusuhuzwa
Publisher: Springer Nature
ISBN: 9813367466
Category : Business & Economics
Languages : en
Pages : 168
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Book Description
This book analyzes evolution of monetary policy in Rwanda since it was first implemented by the National Bank of Rwanda in 1964 when the bank was established. It contributes to the understanding of monetary policy which is formulation and implementation in different stages of development of a financial system that comprises the financial market (money market and capital market), financial intermediaries such as commercial banks, and the financial sector infrastructures such as payment systems and the credit reference bureau. The book breaks down applied empirical research on the assessment of key assumptions of a monetary targeting framework, namely the stability of money multiplier and money demand using econometrics of time series, through a number of case studies. Presenting a detailed empirical analysis of the monetary transmission mechanism, one of the most analyzed topics in central banks in advanced economies, this book is a valuable read for central bankers and other researchers of monetary policy, particularly in developing economies.
Author: International Monetary Fund
Publisher: International Monetary Fund
ISBN: 1498344062
Category : Business & Economics
Languages : en
Pages : 74
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Book Description
Over the past two decades, many low- and lower-middle income countries (LLMICs) have improved control over fiscal policy, liberalized and deepened financial markets, and stabilized inflation at moderate levels. Monetary policy frameworks that have helped achieve these ends are being challenged by continued financial development and increased exposure to global capital markets. Many policymakers aspire to move beyond the basics of stability to implement monetary policy frameworks that better anchor inflation and promote macroeconomic stability and growth. Many of these LLMICs are thus considering and implementing improvements to their monetary policy frameworks. The recent successes of some LLMICs and the experiences of emerging and advanced economies, both early in their policy modernization process and following the global financial crisis, are valuable in identifying desirable features of such frameworks. This paper draws on those lessons to provide guidance on key elements of effective monetary policy frameworks for LLMICs.
Author: Woon Gyu Choi
Publisher: International Monetary Fund
ISBN: 1451918682
Category : Business & Economics
Languages : en
Pages : 29
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Book Description
This paper uncovers Taylor rules from estimated monetary policy reactions using a structural VAR on U.S. data from 1959 to 2009. These Taylor rules reveal the dynamic nature of policy responses to different structural shocks. We find that U.S. monetary policy has been far more responsive over time to demand shocks than to supply shocks, and more aggressive toward inflation than output growth. Our estimated dynamic policy coefficients characterize the style of policy as a "bang-bang" control for the pre-1979 period and as a gradual control for the post-1979 period.
Author: Mrs.Jana Bricco
Publisher: International Monetary Fund
ISBN: 1513517856
Category : Business & Economics
Languages : en
Pages : 49
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Book Description
The analysis of interconnectedness and contagion is an important part of the financial stability and risk assessment of a country’s financial system. This paper offers detailed and practical guidance on how to conduct a comprehensive analysis of interconnectedness and contagion for a country’s financial system under various circumstances. We survey current approaches at the IMF for analyzing interconnectedness within the interbank, cross-sector and cross-border dimensions through an overview and examples of the data and methodologies used in the Financial Sector Assessment Program. Finally, this paper offers practical advice on how to interpret results and discusses potential financial stability policy recommendations that can be drawn from this type of in-depth analysis.
Author: International Monetary Fund
Publisher: International Monetary Fund
ISBN: 1498343694
Category : Business & Economics
Languages : en
Pages : 61
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Book Description
With single-digit inflation and substantial financial deepening, developing countries are adopting more flexible and forward-looking monetary policy frameworks and ascribing a greater role to policy interest rates and inflation objectives. While some countries have adopted formal inflation targeting regimes, others have developed frameworks with greater target flexibility to accommodate changing money demand, use of policy rates to signal the monetary policy stance, and implicit inflation targets.
Author: James Atta Peprah
Publisher: Springer Nature
ISBN: 3031093453
Category : Business & Economics
Languages : en
Pages : 321
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Book Description
This book investigates factors that contribute to the development of an efficient financial sector in Ghana. While sustainable finance has long been known to propel economic growth and development, and while many African countries have taken initiatives to develop integrated frameworks of their financial sectors that tackle developmental challenges, scholars and policymakers have always grappled with understanding of factors that enhance performance of the financial sector. In this book, an expert team of authors examines the financial landscape, central bank policies, competition, financial innovation, financial inclusion and banking stability in Ghana, while also exploring how financing models such as enterprise finance and microfinance can be more effective in sustaining financial markets. The authors discuss how Ghana can build fortified institutions, regulatory frameworks, and productive capacity to strengthen the financial sector and foster pathways that will enhance economic development. Empirical and scientific evidence give this book a unique approach that is both qualitative and quantitative.
