Leading Indicators of Currency Crises

Carmen Reinhart (), Graciela Laura Kaminsky () and Saul Lizondo

MPRA Paper from University Library of Munich, Germany

Abstract: This papers examines the empirical literature on currency crises and proposes a specific early warning system. This system involves monitoring the evolution of several indicators that tend to exhibit unusual behaviorin the periods preceding a crisis. When an indicator exceeds a certain threshold value, this is interpreted as a warning "signal" that a currency crisis may take place within the following 24 months. The variables that have the best track record within this approach include exports, deviations of the real exchange rate from trend, the ratio of broad money to international reserves, output, and equity prices.

Keywords: financial crisis; currency; indicators; banking (search for similar items in EconPapers)
JEL-codes: F4 F3 E3 (search for similar items in EconPapers)
Date: 1998
View citations in EconPapers

Published in IMF Staff Papers 1.45(1998): pp. 1-48

Downloads: (external link)
http://mpra.ub.uni-muenchen.de/6981/

Related works:
Working Paper: Leading Indicators of Currency Crises (1997)
Working Paper: Leading indicators of currency crises (1997)
Journal Article: Leading Indicators of Currency Crisis (1998)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany
Address: Schackstr. 4, D-80539 Munich, Germany
Contact information at EDIRC.
Series data maintained by Ekkehart Schlicht ().