Methodology For Cger Exchange Rate Assessments
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Author | : International Monetary Fund. Research Dept. |
Publisher | : International Monetary Fund |
Total Pages | : 41 |
Release | : 2006-08-11 |
Genre | : Business & Economics |
ISBN | : 1498332021 |
Exchange rate surveillance has always been at the core of the IMF’s responsibilities. Throughout its existence, the Fund has strived to strengthen its framework for assessing exchange rates, adapting it to underlying macroeconomic and financial developments in member countries. As part of this mandate, since the mid-1990s the Consultative Group on Exchange Rate Issues (CGER) has provided exchange rate assessments for a number of advanced economies from a multilateral perspective, with the aim of informing the country-specific analysis of Article IV Staff Reports and fostering multilateral consistency.
Author | : Mr.Abdul Abiad |
Publisher | : International Monetary Fund |
Total Pages | : 29 |
Release | : 2009-02-01 |
Genre | : Business & Economics |
ISBN | : 1451871791 |
The IMF's Consultative Group on Exchange Rate issues (CGER) has been conducting exchange rate assessments as part of the surveillance process since 1997. This paper evaluates CGER assessments from 1997 to 2006, by comparing these to subsequent movements in real effective exchange rates (REER). We find that CGER's estimated misalignments have predictive power over future REER movements, especially over longer horizons and after changes in fundamentals are accounted for. But while CGER misalignments frequently predict the direction of currency movements correctly, misalignments have tended to be persistent, resulting in systematic errors-overprediction for undervalued currencies and underprediction for overvalued currencies.
Author | : Mr.Jaewoo Lee |
Publisher | : International Monetary Fund |
Total Pages | : 34 |
Release | : 2008-04-07 |
Genre | : Business & Economics |
ISBN | : 1589066383 |
The rapid increase in international trade and financial integration over the past decade and the growing importance of emerging markets in world trade and GDP have inspired the IMF to place stronger emphasis on multilateral surveillance, macro-financial linkages, and the implications of globalization. The IMF's Consultative Group on Exchange Rate Issues (CGER)--formed in the mid-1990s to provide exchange rate assessments for a number of advanced economies from a multilateral perspective--has therefore broadened its mandate to cover both key advanced economies and major emerging market economies. This Occasional Paper summarizes the methodologies that underpin the expanded analysis.
Author | : International Monetary Fund. Independent Evaluation Office |
Publisher | : International Monetary Fund |
Total Pages | : 147 |
Release | : 2007-08-22 |
Genre | : Business & Economics |
ISBN | : 1589066499 |
The IMF is charged by its Articles of Agreement and a 1977 Executive Board Decision to exercise surveillance over the international monetary system and members’ exchange rate policies. The overriding question addressed by this evaluation is whether, over the 1999–2005 period, the IMF fulfilled this core responsibility. The main finding is that the IMF was simply not as effective as it needs to be in both its analysis and advice and in its dialogue with member countries. The evidence supporting this conclusion, along with other key findings, is set out in this report. The report also presents a detailed set of recommendations that could go a long way in improving the quality and effectiveness of IMF surveillance.
Author | : Burcu Aydin |
Publisher | : International Monetary Fund |
Total Pages | : 34 |
Release | : 2010-07-01 |
Genre | : Business & Economics |
ISBN | : 1455201456 |
This paper provides an exchange rate assessment for sub-Saharan African economies by using methodologies similar to those developed by the International Monetary Fund’s Consultative Group on Exchange Rate Issues. As in the World Economic Outlook (IMF, 2009a), the unbalanced panel dataset covers 182 countries from 1973 to 2014. We apply four methodologies to assess the fundamental exchange rate: macroeconomic balance, equilibrium real exchange rate, external sustainability, and purchasing power parity. Results show that the impact of macroeconomic fundamentals on the equilibrium real exchange rate is different for sub-Saharan African economies than for advanced and less advanced economies.
Author | : Louellen Stedman |
Publisher | : International Monetary Fund |
Total Pages | : 57 |
Release | : 2017-12-27 |
Genre | : Business & Economics |
ISBN | : 1484325761 |
This report is the seventh in a series of evaluation updates by the Independent Evaluation Office of the IMF (IEO) that return to past IEO evaluations and assess the continuing relevance of their main conclusions. The report revisits the 2007 evaluation of IMF Exchange Rate Policy Advice, which found that the IMF was “not as effective as it needed to be” in fulfilling its responsibilities for exchange rate surveillance in the period 1999–2005. While acknowledging the inherent complexity of providing exchange rate policy advice, including the lack of professional consensus on many of the key issues, the evaluation observed serious weaknesses in the IMF’s work on key analytical issues and in its engagement with members. The update finds that the IMF has substantially overhauled its approach to exchange rate policy advice since 2007. Key steps taken include: adoption of a more comprehensive approach to exchange rate surveillance under the 2012 Integrated Surveillance Decision; development of enhanced analytical tools; a new institutional view on capital flows; and introduction of the annual External Sector Report that provides an integrated picture of the external balances of major economies. The IMF continues to work on further enhancements of its approach. Nonetheless, the update concludes that challenges remain that impact the effectiveness of the IMF’s work in an area central to its mandate. The approach for assessing external balances and exchange rates continues to be contentious, in part reflecting differing views across the membership about the process of external adjustment. There are also ongoing questions in other areas, including considerations for exchange rate regime choice, attention to policy spillovers, the institutional view on capital flows, and data availability. The update suggests that the persistence of key issues identified in 2007 merits a full evaluation by the IEO.
Author | : International Monetary Fund. Strategy, Policy, & Review Department |
Publisher | : International Monetary Fund |
Total Pages | : 34 |
Release | : 2016-08-02 |
Genre | : Business & Economics |
ISBN | : 1498346030 |
The Fund has taken important steps to enhance its external sector assessments since the launch of the External Balance Assessment (EBA) methodology and the External Sector Report (ESR) in 2012, which provides a multilaterally consistent assessment of the largest economies’ external sector positions and policies. With scope for strengthening external sector assessments of non-EBA countries, the 2014 Triennial Surveillance Review (TSR) called for the application of EBA’s conceptual innovations to a broader set of countries. Following the 2014 TSR, the Managing Director’s Action Plan proposed developing EBA-lite to extend the EBA methodology to a broader group of countries where adequate data is available. In the fall of 2014, the launch of the EBA-lite methodology for current account assessments provided the first extension of EBA approach for non-EBA countries. In summer 2015, the real exchange rate index model and the external sustainability approach were added to the EBA-lite framework. This note serves as a reference for the EBA-lite methodology. It provides: (i) motivations for developing EBA-lite and guidance for its use; (ii) technical explanations of all three EBA-lite approaches; and (iii) suggestions on how to articulate staff assessments of the external sector informed by model results.
Author | : Anna Ter-Martirosyan |
Publisher | : International Monetary Fund |
Total Pages | : 61 |
Release | : 2014-01-17 |
Genre | : Business & Economics |
ISBN | : 1475554680 |
External Assessments in Special Cases presents the pilot External Balances Assessment methodology developed by IMF staff for estimating current account and exchange rate gaps for a group of advanced and emerging market economies, and discusses modifications to take account of special cases. Different approaches to external assessments for countries with special circumstances are evaluated, and some tools presented that could be used to inform sound judgment on the part of those conducting such assessments.
Author | : Luca Antonio Ricci |
Publisher | : |
Total Pages | : 38 |
Release | : 2009 |
Genre | : |
ISBN | : |
The rapid increase in international trade and financial integration over the past decade and the growing importance of emerging markets in world trade and GDP have inspired the IMF to place stronger emphasis on multilateral surveillance, macro-financial linkages, and the implications of globalization. The IMF's Consultative Group on Exchange Rate Issues (CGER)--formed in the mid-1990s to provide exchange rate assessments for a number of advanced economies from a multilateral perspective--has therefore broadened its mandate to cover both key advanced economies and major emerging market economies. This Occasional Paper summarizes the methodologies that underpin the expanded analysis.
Author | : Mr.Luis M. Cubeddu |
Publisher | : International Monetary Fund |
Total Pages | : 68 |
Release | : 2019-03-19 |
Genre | : Business & Economics |
ISBN | : 149830463X |
The assessment of external positions and exchange rates is a key mandate of the IMF. This paper presents the updated External Balance Assessment (EBA) framework—a key input in the conduct of multilaterally-consistent external sector assessments of 49 advanced and emerging market economies—following the two rounds of refinements adopted since the framework was introduced in 2012 (as described in Phillips et al., 2013). It also presents new complementary tools for shedding light on the role of structural factors in explaining external imbalances and assessing potential biases in the measurement of external positions. Remaining challenges and areas of future work are also discussed.