IMF高级宏观经济学研修班课程CT1405MMF-L02Moneta

L-2.MonetaryandExchangeRatePolicyFrameworksandStrategies,PresenterRayBrooks,JointChina-IMFTrainingProgramCourseonMacroeconomicManagementandFinancialSectorIssuesCT14.05,Outline,Whataretheultimategoalsofmonetarypolicy?Whatarethealternativeframeworksandhowdotheywork?Howtochooseamonetaryframework?Whatchoicesweremadeinthepast?Howwelldidtheyperform?Chinaschoices,2,ThistrainingmaterialisthepropertyoftheInternationalMonetaryFund(IMF)andisintendedforuseinIMFsInstituteforCapacitydevelopment(ICD)courses.AnyreuserequiresthepermissionofICD.,I.Whataretheultimategoalsofmonetarypolicy?,1.Pricestability2.Outputandemployment3.Exchangeratestability4.Postglobalcrisis,callstoalsotargetfinancialstability,3,Therelationshipbetweeninflationandcyclicalunemploymenthaschangedovertime,ApparentthattheslopeofPhillipscurvehasfallen,JV13.13.,5,Source:April2013WEO,Whatcanmonetarypolicydo?,CaneffectivelycontrolpricesandexchangeratesnominalvariablesCanserveasanominalanchorintheeconomyCancontributetoeconomicgrowthandhelpcreatejobsthroughlowandstableinflationButitcannotbearealanchorunemployment,growth,andrealexchangeratecannotbeaffectedpersistently,6,JV13.13.,Monetarypolicyaffectsdemand,notsupply,ToomuchdemandstimulusstokesinflationStabilizeoutputarounditspotentialandinflationaroundtheinflationtargetJointlyminimizevolatilityofoutputandinflationsy;sp,7,Quantity,Price,AD,AS,Long-runAS,JV13.13.,ExchangeRatePolicy:Overview,Intheshortrun,thenominalERlevelaffectstherealexchangerate:Ifdomesticinflationishigh,afixedexchangeratemightappreciatetheRER.“Therealexchangerateisalwaysflexible”AnappreciatedRERaffectscompetitivenessofexportsandcanleadtocurrentaccountdeficits.AflexibleERmightbeapowerfultooltorestoreexternalequilibrium.,8,II.WhataretheAlternativeMonetaryandExchangerateFrameworksandhowdotheywork?,“Therearemanywaystoskinacat”StoneandBhundiaclassification,9,JV13.13.,10,Compatiblechoices,Countriesneedtochooseamonetarypolicystrategy(e.g.,moneygrowthtargetsorinflationtargets)andanexchangeratearrangementThetwochoicesmustbecompatible,JV13.13.,TheImpossibleTrinity,11,CAPITALCONTROLS,Monetaryindependence,HardPeg,PUREFLOAT,CapitalMobility,increasingcapitalmobility,Exchangeratestability,China,U.S.,Japan,EU,12,The“impossibletrinity”,Itisimpossibletosimultaneouslymaintain:afixedexchangerateandautonomousmonetarypolicytopursuegoalsfordomesticeconomicactivityandpricestabilityiftheeconomyreliesonalargevolumeofpotentiallyvolatileandinternationallymobilesourcesoffinance,JV13.13.,FourViableAlternativeMonetaryandExchangeRateRegimes,ExchangeratetargetingMonetaryaggregatestargetingInflationtargetingOther“eclectic”frameworks,13,JV13.13.,14,HARDPEGSExchangearrangementswithnoseparatelegaltenderCurrencyunionDollarizationCurrencyboard,INTERMEDIATE(SoftPegs)ConventionalpegStabilizedarrangementPegwithhorizontalbandsCrawlingpegCrawl-likearrangement,FLOATINGFloatingFreefloating,RangeofOptionsforExchangeRate,1.Exchangeratetargeting,TheexchangerateisthenominalanchorPre-World-War-IgoldstandardBretton-Woodsregime(1945-71)AllcountriespeggingtogoldthroughtheU.S.dollarArgentinascurrencyboard(1991-2001)“Hard”pegDollarpeginSouthKorea,Thailand,Indonesia“Soft”pegWestAfricaMonetaryUnion,EuropeanMonetaryUnion(regionalsystem),15,JV13.13.,HowdoesERtargetingwork?,KeeptheERontarget(level,“crawl”,andsoon)Aslongasthecapitalaccountisatleastpartlyopen,domesticinterestrateworldinterestrate+riskpremiumThe“lawofoneprice”(PPP)willtakecareofinflationconvergence(dz=p*-p)MaintainliquidityinthebankingsystemItsacomparativelysimpleregimetooperate!,16,JV13.13.,“Thedevilisinthedetail”,Acountrymaysaythattheyaremaintainingacrawlingpeg/managedfloat/freefloat,but:HavenovolatilityoftheexchangerateWhileofficiallyfloating,somecentralbanksusedtophonecommercialbankwith“suggested”ERsAccumulateinternationalreservesDistinguishdejureanddefactoregimes!ChinaisdejuremanagedfloatingarrangementButdefactoclassifiedasa“crawl-likearrangement”byIMFin2013ArticleIV(astheRMB-U.S.$ratehasremainedina2percentcrawlingband),17,JV13.13.,ChinaspegwasstableagainstUS$mid-1990stomid2000sbutnominaleffectiveexchangeratemoved,JV13.13.,18,Chinasrealeffectiveexchangeratehasappreciatedmorethanthenominalrate,JV13.13.,19,2.Monetaryaggregatestargeting,Monetarygrowthisthenominalanchor.Basedonthequantitytheoryofmoney(Friedman,1956):MV=PYInflationfrom“manydollarsbehindfewgoods.”Monetarypolicyinstrumentsadjustedtotargetgrowthrateofmoneysupply(e.g.,broadmoney),20,JV13.13.,2.Monetaryaggregatestargeting,TheexchangeratehastofloataslongasthecapitalaccountisopenThefiscalpositionmustbeundercontrol.Why?M2=NFA+NDA.Examples:Industrialcountries(thelate-1970stomid-1980s)About30countriestoday(mostlylow-income)InspiredtheECBsMonetaryPillar.,21,JV13.13.,HowdoesMTwork?,22,1.Provideliquidityconsistentwithyour,2.intermediatetarget(M2growth),3.toachieveyourultimateobjective(p*),Needtobelieveinp=f(M),JV13.13.,3.Inflationtargeting,InflationforecastisthenominalanchorAdjustmonetarypolicyinstrumentstokeepthecentralbanksforecastofinflationconsistentwithapre-announcedtargetExamples:NewZealand,Chile,U.K.,CzechRepublic,Poland,Romania,Thailand,Brazil,Ghana.,23,JV13.13.,24,Istheforecastofinflationontarget?,Yes,Shouldpolicyrespond?,Nochangeininstrument,Determinesizeofresponse,No,Nochangeininstrument,Yes,No,Changeinstrument,“Escapeclauses”permitdeparturefromthetarget,Communicate,Communicate,Communicate,HowdoesITwork?,4.Eclecticmonetarypolicy,Whatisthenominalanchor?Adjustmonetarypolicyinstrumentstopursuestableeconomicgrowthandlowinflation,butwithnoformallypre-announcedtargetsExamples:U.S.,EuroArea,Japan,India,.,25,JV13.13.,Howdoeseclecticpolicywork?,Centralbankshaveinflationobjectives,butnotasexplicitontargetandhorizonasformalITcountriesECB:“inflationbelow,butcloseto,2percent”Fed:“thegoalsofmaximumemployment,stableprices,andmoderatelong-terminterestrates”.DecisionsarealsobasedonforecastsofinflationGoodsystemtoforecastinflationandagoodunderstandingofthetransmissionmechanismiscrucialDifferencebetweenITsand“eclectics”isadifferentlevelofcommunication,althoughconvergence.,26,JV13.13.,Group,(Breakintogroupsof5-6todiscussquestionbelow.Nominateonepersonfromyourgroupwhowillsummarizethediscussion)WhatarethekeyfactorsbehindChinaschoiceofmonetaryandexchangerateframeworkinrecentyears?,27,III.Howtochooseamonetaryframework,Therearealwaysprosandcons,28,JV13.13.,29,Whatistheappropriatemonetaryandexchangeratepolicyregime?,ManyconsiderationsarerelevantSimilarcountriessometimesmakedifferentchoicesThebestchoiceforanyparticularcountrymaychangeovertime,JV13.13.,Choiceofmonetaryframework,Eachmonetaryframeworkhasitsadvantagesanddisadvantages.Thechoicedependsonpolicyobjectivesandtheirrelativeimportance:Reduce/stabilizeinflationStabilizeoutputfluctuationsU.S.:“maximumsustainableemploymentandlowinflation”Avoidfinancialcrises(financialstability)Internationalorregionaleconomicintegration,30,JV13.13.,1.Exchangeratetargeting,ProvidedtheauthoritieshaveaclearcommitmenttoERstability,expectationsofinflationwillstabilizeShort-rundeviationsareinevitableAlonglistofrisks,31,JV13.13.,Risksofexchangeratetargeting,FiscaldominanceunderminestheregimeThepegcurrencymaynotbeconsistentwithtradepatterns(ex.ArgentineanandBrazilianpegstotheU.S.$inthe1990sandsubsequentexits)PegsencouragebuildupofbalancesheetvulnerabilitiesPrivatesectorusedtostableexchangerateignoresexchangeraterisk(plusbailoutexpectations)Buildupinforeigncurrencydebt(Asiancrisis,HungaryandRomanialately),32,JV13.13.,ChinasCurrentAccountSurplushasfalleninrecentyearsandREERhasappreciated,33,Impossibletrinityagain,LossofmonetarypolicyasastabilizationtoolWithinternationalcapitalmobility,impossibletotargetexchangerateandusemonetarypolicyforoutputstabilizationButthelossofindependentmonetarypolicymaybeoffsetbybenefitsofregionalintegratione.g.Euroarea,WAEMUEliminatingexchangeraterisklowerstransactionscostsandincreasestrade,34,JV13.13.,BottomlineonERtargeting,Simpletooperate“Gainsfromtrade”canhelp“import”lowinflationFiscaldominanceNeedtofindtherightpegcurrency(orbasket)LossofmonetarypolicyasastabilizationtoolHigherriskofspeculativeattacksandcrisesFinancialsectorvulnerabilitiesasprivatesectortakesonexchangerateriskCostsofsterilizationforcentralbanks,35,JV13.13.,a,JV13.13.,36,Source:AndrewCheng,2013PBCConferenceonCapitalFlows,2.MonetaryAggregatestargeting,Formonetarytargetingtoachievepricestability,theremustbeastablerelationshipbetweenmonetaryaggregatesandinflationInmanycountries,thishasbrokendownovertheyearsbecauseoffinancialinnovationsmakingvelocityunstableanddifficulttoforecast.Monetarytargetinghaslostmuchofitsappeal,37,JV13.13.,VelocityofM2wasunstablein70sand80s,esp.inGermanyandJapan,JV13.13.,38,InChinatoo,thelinkbetweenmoneyandnominalGDPhasbeennotbeenstable,39,Bottomlineonmonetarytargeting,OperationalsimplicityandtheoreticallysoundbuttheregimeisnotintuitiveThepublicdoesnotunderstandwhatis“broadmoney”,“narrowmoney”,etcEmpiricallydubiousTheshort-runmoney-to-inflationnexusdisappearedinthe1970sThecausalityfrommoneytooutput/pricesdoesnotholdinthedata,40,JV13.13.,3.FlexibleexchangeratebutperhapstoalesserdegreethaninERtargeting,41,JV13.13.,FlexibleERandIT,Operationallycomplex:needtoknowthewholemonetarytransmissionRequiresaworkinglinkfrompolicyratesinterbankrateslongratesWithnoERanchor,thenominalERcanbevolatile(“fearoffloatingsyndrome”)WithaweakERpass-through,therealERisalsovolatileshockstooutputEmphasisonpricestabilitymaycloudotherCBresponsibilities(financialstability),42,JV13.13.,NeedtoLearntoFloat,FearoffloatingexchangerateisabarriertomanyemergingmarketsinadoptingITVoluntarytransitionpriortothetransition,countriestendtohave:strongerbankingsupervision,includingtoreducecurrencymismatchesonbalancesheetsmoredevelopedsecuritiesmarkets;increasedcentralbankindependence,withemphasisonpricestabilitythenadoptinflationtargeting.Crisis-driventransitionafterthetransition,countriesimprovebankingsupervisionanddevelopsecuritiesmarkets.,43,LessonsfromThreeCases,NewZealandCredibilityprobleminitiallyStartedwithstrictapproachBecamemoreflexibleovertime,asinflationexpectationsbecameanchoredChileandIsraelwereabletouseinflationtargetingtodisinflatesuccessfullyIsraelshowedthatcanadoptinflationtargettingevenwithoutmeetingpreconditions,44,45,Bottomlineoninflationtargeting,A“nominalanchor”withoutaERcommitmentMonetarypolicyretainsindependencyunderfullcapitalmobilityFosterstransparencyandaccountabilityTechnicallydemandingFocusonpricestabilitymaybeattheexpenseofotherobjectives“Fearoffloating”considerations,JV13.13.,OnelessonfromtheGreatRecession:centralbanksmustdomorethanjusttargetinflation,46,JV13.13.,IsInflationTargetingDead?,Oldview:Monetarypolicyshouldaimforalowandstableinflationrate.Newview:Stableinflationisnecessarybutnotsufficientformacroeconomicstability.Monetarypolicyshouldreactmorestronglytoindicatorsotherthanoutputandinflationtomitigatedamagingassetpriceboom-bustcycles.Lowinflationlimitsthescopeofmonetarypolicyindeflationaryrecessions.Raisetheinflationtarget?About2/3sofITcentralbankscurrentlytargetheadlineinflationoverthemedium-termoflessthan3percent,47,4.Flexibleexchangerate&eclecticmonetarypolicy,Noexplicitcommitmenttoa“nominalanchor,suchasexchangerate,money,orinfaltion-LotsofdiscretionItmayworkiftheCentralBankalreadyhasalotofcredibility(Fed,SwissNationalBank)Itmaynotworktoachievedisinflation,48,JV13.13.,IV.WhatChoicesweremadeinthePAst,49,JV13.13.,Bretton-Woodsera(1946-1971),FixedexchangeratescurrenciespeggedtotheU.S.dollar&U.S.dollarpeggedtogoldStabilizingthedomesticeconomywasaprimaryobjectiveofmonetarypolicyControlsoninternationalcapitalflows1950sto1970swasaperiodoffinancialrepressioninadvancedcountries,50,JV13.13.,Industrialcountriesafter1971,EuropeancountrieswentfrompegsnarrowbandswidebandsacommoncurrencyOtherindustrialcountriesadoptedmonetaryaggregatetargetsinthelate1970sorearly1980sbutabandonedthemafewyearslaterMostofnon-euroindustrialcountrieshaveadoptedformalinflationtargets(Australia,Canada,Iceland,NewZealand,Norway,Sweden,UnitedKingdom)Alsomorethan20emergingmarketcountries,51,JV13.13.,MonetaryPolicyFramework(2000),Source:IMFAnnualReportonExchangeArrangementsandExchangeRestrictions(AREAER),2001Note:Themonetaryaggregatetargetcategoryincludescountriesthatadoptmonetaryaggregatetargetframeworkinadditiontofundsupportedorothermonetarycountries,andalsocountriesthatonlyadoptfundsupportedorothermonetaryprograms.ExchangerateanchorandInflation-targetingframeworkcategoriesincludecountriesthatalsoadoptfundsupportedorothermonetaryinadditiontotheirrespectiveframeworkprogram(morethanonenominalanchor).,MonetaryPolicyFramework(2011),Source:IMFAnnualReportonExchangeArrangementsandExchangeRestrictions(AREAER),2012,Ev