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Monetary Transmission in an Emerging Targeter The Case of Brazil

This paper lays out a structural model that incorporates key features of monetary transmission in typical emerging-market economies, including a bank-credit channel and the role of external debt accumulation on country risk premia and exchange rate dynamics. We use an SVAR representation of the mode...

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Bibliographic Details
Main Author: Pagan, A. R.
Other Authors: Catão, Luis, Laxton, Douglas
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2008
Series:IMF Working Papers
Subjects:
Price Level
Foreign Exchange
Real Exchange Rates
Bank Credit
Production And Operations Management
Economic Theory
Monetary Policy, Central Banking, And The Supply Of Money And Credit: General
Money And Monetary Policy
Monetary Economics
Currency
Macroeconomics: Production
Prices
Inflation
Output Gap
Deflation
Macroeconomics
Exchange Rates
Production
Credit
Brazil
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
Description
Summary:This paper lays out a structural model that incorporates key features of monetary transmission in typical emerging-market economies, including a bank-credit channel and the role of external debt accumulation on country risk premia and exchange rate dynamics. We use an SVAR representation of the model to study the monetary transmission in Brazil. We find that interest rate changes have swifter effects on output and inflation compared to advanced economies and that exchange rate dynamics plays a key role in this connection. Importantly, the response of inflation to monetary policy shocks has grown stronger and the output-inflation tradeoff improved since the introduction of inflation targeting
Physical Description:42 pages
ISBN:9781451870497

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