Integrated Policy Framework—Principles for the Use of Foreign Exchange Intervention

International Monetary Fund

No 2023/061, IMF Policy Papers from International Monetary Fund

Abstract: This note guides policy advice on the use of foreign exchange intervention (FXI) as part of the Integrated Policy Framework (IPF) in Fund surveillance. The note provides general principles for the advice in countries with flexible exchange rates and sets out three use cases for FXI that are tied to specific frictions. It explores the use of FXI as part of an overall policy response, allowing the advice to differ with shocks, frictions, and country-specific circumstances.

Keywords: Capital flows; Exchange rates; Foreign exchange intervention; Macroprudential Policy; Inflation; Monetary Policy; Integrated Policy Framework; FX mismatch; policy discussion; staff advice; IPF friction; IPF policy; Currency markets; Exchange rate adjustments; Global (search for similar items in EconPapers)
Pages: 61
Date: 2023-12-21
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