 Current Account Imbalance and Exchange Rate PolicyAsian Development Review (ADR), 1991, vol. 09, issue 01, 90-110 Abstract: The sharp rise in the price of crude oil during the latter half of 1990 resulting from the Middle East crisis brings to the fore the issue of the impact of external shocks to the economies in the Asian and Pacific region and how to respond to such shocks. The immediate impact of the Middle East crisis is on the balance-of-payments positions of the region’s economies, primarily due to the rise in oil import payments or oil export earnings and, for some countries, from a reduction in workers’ remittances. For countries which have a substantial current account imbalance even before the Middle East crisis, it exacerbated the current account imbalance and heightened the policy issues that must be tackled to address the imbalance. How much of the current account imbalance is financiable? How far should there be exchange rate change? Should there be a sharp one-shot devaluation? How tight should the fiscal and monetary regime be? How far can we sacrifice growth for stabilization? These are some of the questions that policymakers tend to ask when confronted with the problem of large current account deficits… Date: 1991 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:wsi:adrxxx:v:09:y:1991:i:01:n:s0116110591000052 Ordering information: This journal article can be ordered from DOI: 10.1142/S0116110591000052 Access Statistics for this article Asian Development Review (ADR) is currently edited by Tetsushi Sonobe More articles in Asian Development Review (ADR) from World Scientific Publishing Co. Pte. Ltd. |
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