Working Papers in full text
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
All
Other research-related activities and publications of the IMF can be found at IMF Research
|
Free Email Notification
Receive emails when we post new
items of interest to you.
Subscribe or
Modify your profile
|
|
|
|
Sudden Stops and Currency Drops: A Historical Look
|
Author/Editor: |
Catão, Luis |
| Authorized for Distribution: |
May 1, 2006 |
|
Electronic Access: |
Free Full Text (PDF file size is 673KB)
Use the free Adobe Acrobat Reader to view this PDF file.
|
|
|
|
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.
|
|
Summary: This paper shows that recent manifestations of sudden stops (SSs) in international capital flows have striking parallels in the early financial globalization era preceding World War I. All main capital-importing countries then faced episodic capital flow reversals averaging some 5 percent of GDP and with a median duration of four years. Most SSs also displayed striking crosscountry synchronization, being immediately preceded by rising world interest rates. Both fixed and floating exchange rate regimes were hit, with no significant differences between them. Yet, not all SSs resulted in currency drops: while some countries experienced currency collapses, others managed to preserve exchange rate stability. These different responses are related to domestic "frictions" that heightened the procyclicality of absorption and hindered precautionary reserve accumulation in some countries relative to others.
|
|
|
|
Order a print copy
|
|
Series: |
Working Paper No. 06/133 |
|
Subject(s): |
Financial crisis | Capital flows | Exchange rate regimes |
|
Author's keyword(s): |
Sudden stops
| currency crises
| international capital flows
| gold standard
|
|
|
|
|
| |
Published: |
|
May 1, 2006 |
|
|
|
|
| |
ISBN/ISSN: |
|
0 / 1934-7073 |
|
Format: |
|
Paper |
| |
Stock No: |
|
WPIEA2006133 |
|
Pages: |
|
61 |
| |
Price: |
|
US$15.00 (Academic Rate: US$15.00 )
|
|
|
|
|
|
|
