Exchange Rate Regimes and Macroeconomic Stability in Central and Eastern Europe

Paul De Grauwe and Gunther Schnabl ()
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Paul De Grauwe: Catholic University Leuven

International Finance from EconWPA

Abstract: The IMF classifications of the Central and Eastern European exchange rate arrangements are heterogeneous. While one group of countries reports tight pegs to the euro, a second group seems to have moved toward (more) exchange rate flexibility. Based on the recent discussion about the accuracy of IMF exchange rate arrangement classifications, low- and high-frequency exchange rate stability in Central and Eastern Europe is explored here. De facto exchange rate stabilization is found to be much more prevalent in Central and Eastern Europe than suggested by de jure exchange rate classifications. Most of the CEE countries peg their currencies to the euro, thereby contributing to a growing euro zone. Nevertheless, as exchange rate stabilization against the euro is pursued with different degrees and with different long-term drifts, intra-regional exchange rates are still far from being unified.

Keywords: Exchange Rate Regimes; Inflation; Growth; Central and Eastern Europe; Macroeconomic Stability (search for similar items in EconPapers)
JEL-codes: F31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ifn and nep-tra
Date: 2004-04-13
Note: Type of Document - pdf; pages: 29
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http://129.3.20.41/eps/if/papers/0404/0404011.pdf (application/pdf)

Related works:
Working Paper: Exchange Rate Regimes and Macroeconomic Stability in Central and Eastern Europe (2004)
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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpif:0404011

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