The World Economy

Ray Barrell, R. Anderton, Guglielmo Maria Caporale and J.W. in't Veld
Authors registered in the RePEc Author Service: Jan in 't Veld

National Institute Economic Review, 1993, vol. 145, 43-63

Abstract: The deepening recession in Europe during the first half of 1993 has resulted in increasing pressure on the stability of exchange rates. The Exchange Rate Mechanism went through a crisis in late-July/early-August., and very wide fluctuation bands were adopted on the 2nd of August. Table 1 presents our forecast for output and inflation, which helps put the turmoil on the exchanges in context. Output is expected to fall in Germany and France in 1993, but the causes and consequences differ considerably. The recession in the former country may just take output back to a little below capacity whereas in France there has been a good deal of spare capacity for some time.

Date: 1993
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