Optimal Reserves in the Eastern Caribbean Currency Union |
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| Author:
| Samuel, Wendell A.
Pineda, Emilio
Dehesa, Mario |
| Series title: | IMF Working Papers |
| ISBN: | 978-1-4623-2046-2 |
| Publication Date: | Apr 2009 |
| Publisher: | International Monetary Fund
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| Book Format: | Ebook |
| List Price: | USD $9.00 |
Book Description:
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Recent turbulence in global and Caribbean regional financial markets underscore the importance of reassessing the adequacy of international reserves held by the Eastern Caribbean Central Bank (ECCB). Using the Jeanne (2007) optimization framework, this paper finds that international reserves held by the ECCB are generally adequate for a variety of external current account and capital account shocks. However, the ECCB would be challenged in the event of moderate to severe deposit outflows.
Recent turbulence in global and Caribbean regional financial markets underscore the importance of reassessing the adequacy of international reserves held by the Eastern Caribbean Central Bank (ECCB). Using the Jeanne (2007) optimization framework, this paper finds that international reserves held by the ECCB are generally adequate for a variety of external current account and capital account shocks. However, the ECCB would be challenged in the event of moderate to severe deposit outflows.