Measures to Limit the offshore Use of Currencies: Pros and Cons

International Monetary Fund

No 2001/043, IMF Working Papers from International Monetary Fund

Abstract: Several Asian emerging market economies have recently adopted measures to limit the offshore trading of their currencies. This paper provides a general overview of such measures and evaluates the experiences of selected countries that resorted to such measures. It concludes that the measures could be effective if they were comprehensive and effectively enforced, and were accompanied by consistent macroeconomic policies and structural reforms. Such measures, however, could adversely affect investor confidence, financial market development, and nonspeculative economic and financial activities, and impose administrative burden on all parties involved.

Keywords: WP; currency; bank; market; U.S. dollar; yield; Offshore currency trading; offshore markets; speculative attacks; exchange controls; capital controls; currency internationalization; currency market; Thai baht; exchange rate; Singapore dollar; offshore market; central bank; deutsche mark; currency trading; offshore currency market; malaysian ringgit; short position; Currencies; Currency markets; Offshore financial centers; Exchange rates; Asia and Pacific; Global (search for similar items in EconPapers)
Pages: 54
Date: 2001-04-01
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Citations: View citations in EconPapers (4)

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