Exchange Rate Policy and Monetary Strategy Options in the Philippines : The Search for Stability and Sustainability

Author/Editor:

Aerdt G. F. J. Houben

Publication Date:

May 1, 1997

Electronic Access:

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Summary:

This paper evaluates the Philippines’ experience with different exchange regimes since 1970. It argues that the shift to a flexible regime was crucial to restoring external viability and generating an export-led economic take-off, but that mixed performance in meeting money targets and asymmetric policy reactions to exchange rate pressures have resulted in an uneven inflation performance. Since adoption of a firm nominal anchor for monetary policy would contribute to a more effective control of inflation and thereby to better prospects for sustained growth, the merits of three monetary strategy options are reviewed: stricter adherence to a money supply rule, adoption of an exchange rate peg, and a switch to direct inflation targeting.

Series:

Papers on Policy Analysis and Assessment No. 97/4

Subject:

English

Publication Date:

May 1, 1997

ISBN/ISSN:

9781451973341/1934-7456

Stock No:

PPIEA0041997

Price:

$10.00 (Academic Rate:$10.00)

Format:

Paper

Pages:

36

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