The External Balance Assessment Methodology: 2018 Update
IMF Working Papers, March 19, 2019
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- Canonical URL
- The External Balance Assessment Methodology: 2018 Update
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Bibliographic details
- Authors: Luis M. Cubeddu, Signe Krogstrup, Gustavo Adler, Pau Rabanal, Mai Dao, Swarnali A Hannan, Luciana Juvenal, Cyril Rebillard, Daniel Garcia-Macia, Callum Jones, Jair Rodriguez, Kyun Suk Chang, Deepali Gautam, Zijiao Wang, Nan Li
- Published: March 19, 2019
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781498300933.001
Overview and scope
- 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.
- Builds on the framework introduced in 2012 and two subsequent rounds of refinements (as described in Phillips et al., 2013).
- Introduces new complementary tools to:
- Shed light on the role of structural factors in explaining external imbalances.
- Assess potential biases in the measurement of external positions.
- Discusses remaining challenges and areas of future work.
Key substantive findings and contributions
- The EBA framework remains central to the IMF’s assessment of external positions and exchange rates.
- The update provides:
- A multilaterally-consistent methodology applied across 49 advanced and emerging market economies.
- New tools focused on structural-factor explanations of external imbalances.
- Diagnostics for potential measurement biases in external-position indicators.
Subjects and keywords (as listed)
- Subjects:
- Balance of payments
- Capital controls
- Current account
- Current account balance
- External balance assessment (EBA)
- External position
- Foreign exchange
- Real effective exchange rates
- Keywords:
- capital control
- capital control index
- Capital controls
- current account
- Current account balance
- current account gap
- current account level
- current account model
- EBA current account balance assessment
- EBA current account model
- exchange rate
- exchange rates
- External balance assessment (EBA)
- external sustainability
- foreign exchange
- Global
- global imbalances
- model residual
- potential GDP
- Real effective exchange rates
- reer-index model
- REER-Index model
- WP
Summary of purpose and next steps emphasized
- Purpose:
- Provide an updated, multilaterally-consistent EBA framework to assess external positions and exchange rates across a broad set of economies.
- Enhance understanding of structural drivers of external imbalances and measurement biases.
- Next steps / remaining work (as discussed in the paper):
- Addressing remaining challenges in the measurement and interpretation of external positions.
- Further refinements to tools that link structural factors to external imbalances.
IMF Working Papers: "The External Balance Assessment Methodology: 2018 Update", March 19, 2019.
Content in this bundle
- Working Paper