Exchange Rate Regimes and the Nominal Convergence

Mateusz Szczurek

No 266, CASE Network Studies and Analyses from CASE-Center for Social and Economic Research

Abstract: The paper examines theoretical literature, recent EMU accession examples, and current CEECs performance in search of the optimal currency regime for meeting the Maastricht criteria. Currency board arrangements seems to provide the fastest convergence. For other regimes, the markets may have theoretical and historical reasons to believe in the government's temptation to devalue on the ERM-2 entry. The government should announce the final date, and, possibly indicate the final exchange rate for the regime switch to avoid excessive currency and yield volatility. It should also underscore the central bank’s and EU authorities importance (even if non-existent) in the parity setting process to avoid excessive domestic debt inflation premium ahead of the accession. Recent experience shows that it will be easy to get rid of the remaining influence of cross rates on CEECs exchange rates.

Keywords: EMU; CEECs; exchange rate regimes; currency crises; Maastricht criteria; ERM-2 (search for similar items in EconPapers)
Pages: 38 Pages
Date: 2003
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://case-research.eu/upload/publikacja_plik/1671270_266.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found

Related works:
Chapter: Exchange Rate Regimes and Nominal Convergence (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sec:cnstan:0266

Access Statistics for this paper

More papers in CASE Network Studies and Analyses from CASE-Center for Social and Economic Research Contact information at EDIRC.
Bibliographic data for series maintained by Marta Kowerko ().