Exchange rate
Updated Bank of Mauritius survey questions people on inflation causes
Latest survey shows Mauritian stakeholders are wary of external factors; exchange rate was viewed as second most important factor under new question format
IMF supports Chile move to form financial markets commission
Body will help with better co-ordination and information sharing between the financial sector and central bank; fund says central bank should be ready to cut rates if disinflation appears
IMF urges Sri Lanka to ‘modify’ international reserves target
Deputy managing director says international reserves remain below “comfortable levels”; central bank intends to continue building up reserves while allowing for “greater” exchange rate flexibility
Venezuela central bank launches new banknotes amid soaring inflation
The bolivar has weakened to unprecedented levels as inflation soars and political instability engulfs the nation; new note series’ highest denomination is 200 times larger than current highest
Peso depreciation is ‘necessary’ – Bank of Mexico report
Mexico’s relationship with the US has made it sensitive to economic policy decisions by its major trade partner; latest report explains the central bank will prevent exchange rate “contagion”
Malawi cuts interest rates on the back of lower inflation
Central bank cuts interest rates by three percentage points to contain inflation, though it also hopes to protect reserves
Central Bank of Honduras legislation needs to be ‘fast tracked’, says IMF
Implementation of inflation targeting regime hinges on legislative change, IMF says in latest report; Honduran authorities to submit legislative reform on central bank mandate by March 2017
Colombian paper models non-linearity in sovereign risk
Model of real exchange rates seeks to capture the non-linear effects of sovereign risk for Latin American countries
Bank of Mexico hikes following Trump election shock
Peso hit hard by Donald Trump's election victory, with possible US fiscal expansion and Fed rate hike likely to draw more capital from emerging markets, central bank says
BIS’s Shin links dollar strength to global malaise
Head of research outlines how dollar strength affects leverage globally, causing deviations from covered interest parity and potentially impacting growth and trade
Reserve Bank of Malawi issues new highest denomination banknote
Central bank issues new denomination as inflation and depreciation continue; 2,000 kwacha note will enter circulation next month
Jamaica establishes foreign exchange market working group
Governor Wynter calls meeting to inform market about new group, established to formulate proposals to address the depreciation of the Jamaican dollar
RBNZ delivers rate cut as exchange rate strength persists
Board reaffirmed move in light of Trump victory, but cut has been in the offing for some time as NZ dollar strength holds down inflation
Tuvalu eliminates foreign exchange restrictions
Tuvalu government repeals Exchange Control Act to adhere to IMF articles of agreement; move will help foster investment and international trade, fund says
Central Bank of Egypt devalues currency
Egyptian pound falls 32% as central bank moves to align official and black market rates; IMF mission chief welcomes additional exchange rate flexibility
More research needed on exchange rate pass-through, ECB article says
Research on effects of different shocks on inflation “still in an incipient phase”
Egypt PM signals move to unify exchange rates
Sherif Ismail tells parliament central bank will soon unify black-market and official rates; IMF moving closer to agreement on funding
Hedging demand can cause covered interest parity violations – BIS paper
US dollar forward hedging demand can cause covered interest parity to fail even when markets are calm, authors say, helping explain this post-2012 anomaly
Public sector balance sheet poses risks for Dominican Republic – paper
IMF working paper analyses balance sheet developments in the South American nation’s economy; foreign currency exposure could amplify risks, authors say
Still room to support domestic economic growth after cut, says Ugandan governor
Exchange rate movements remain key risk to inflation, says Tumusiime-Mutebile, as Bank of Uganda cuts interest rates by 100bps
UK inflation jump to 1% is just ‘tip of the iceberg’
Latest inflation data shows leap from 0.6% in August to 1% in September; former MPC member Sentance says this is just tip of the iceberg
Foreign investment ‘restored’ exchange rates after policy shocks – paper
Data from Colombian central bank shows foreign exchange intervention have “short-lived effects” on prices; over the medium term, foreign capital flows push exchange rate back to original level
Evolution of exchange rate main risk to inflation – Mexican deputy
Electoral uncertainty playing on the minds of policy-makers at Bank of Mexico, says Guzmán Calafell; higher pass-through to prices now more of a risk thanks to peso depreciation
Don’t underestimate East Africa’s potential, says Sarb deputy
Eastern region of the continent benefitting from slower inflation and improved regulatory regime, Mminele says; “strict” fiscal discipline must be applied throughout the region