2013年-IMF国际货币组织全球_Monetary_Policy_in_Emerging_Markets_Taming_the_Cycle_30页_1mb

Summary of "Monetary Policy in Emerging Markets: Taming the Cycle"

Core Content

This IMF Working Paper analyzes the cyclical behavior of monetary policy in emerging markets (EMs) and its evolution over the past 50 years. It contrasts EMs with advanced markets (AMs) and highlights the shift in EM monetary policy from being procyclical to more countercyclical, particularly since the early 2000s. The paper also investigates the factors that have contributed to this shift and evaluates the implications for output variability.

Main Findings

• Monetary Policy Cyclicality: EMs have generally adopted more procyclical monetary policy in the past, but there has been a significant shift towards countercyclical policy over time, especially in the post-1996 period.
• Countercyclical Progress: The transition to countercyclical monetary policy in EMs is associated with:
  • The adoption of inflation targeting (IT).
  • Strengthening of institutions.
  • Improved financial market development.
• Output Stability: More countercyclical monetary policy is correlated with lower output volatility, suggesting that countercyclical policy can contribute to macroeconomic stability.
• Role of Exchange Rates: In EMs with flexible exchange rate regimes, the presence of deep financial markets is essential for the adoption of countercyclical monetary policy.
• Recent Crisis Impact: The global financial crisis led to a reversal of the countercyclical trend in EMs, with some countries reverting to more procyclical policies due to the challenges of managing inflation and capital flows.

Key Determinants of Cyclicality

• Inflation Targeting (IT): IT has been a key driver of countercyclical monetary policy in EMs. Countries that adopted IT showed a stronger move towards countercyclical behavior.
• Institutional Quality: Stronger institutions are associated with more countercyclical monetary policy, as they provide the framework for independent and effective central bank operations.
• Exchange Rate Regime: Flexible exchange rate regimes are more conducive to countercyclical policy, especially when financial markets are developed. Fixed exchange rates can lead to procyclical behavior due to capital flow constraints.
• Financial Market Development: Deeper financial markets improve the transmission of monetary policy, enabling more effective countercyclical responses. The interaction between financial development and exchange rate flexibility is particularly important.
• Other Factors: Several other variables, such as capital account openness, terms of trade shocks, and fiscal deficits, were found to be less significant in determining monetary policy cyclicality.

Policy Implications

• Inflation Targeting Benefits: The adoption of IT has not only helped reduce inflation but also significantly improved the countercyclical nature of monetary policy, which in turn has reduced output variability.
• Institutional Reforms: Institutional strengthening is crucial for enabling central banks to implement countercyclical policies effectively.
• Financial Deepening: Financial market development is a prerequisite for EMs with flexible exchange rates to pursue countercyclical monetary policy.
• Need for Stability: The paper emphasizes the importance of macroeconomic stability and the need for EMs to continue improving institutional and financial frameworks to sustain countercyclical monetary policy.

Case Study: Chile

• Graduation from Procyclical to Countercyclical Policy: Chile is a prime example of an EM that successfully transitioned from procyclical to countercyclical monetary policy.
• Monetary Policy Evolution: Before the 1990s, Chile's monetary policy was pro-cyclical, with the central bank subordinated to fiscal policy. After the introduction of IT in 1990, monetary policy became more countercyclical.
• Key Reforms: Chile introduced a more permanent inflation target, moved to a freely floating exchange rate, and liberalized its capital account following financial market deepening and improved regulation.
• Impact on Inflation and Output: The shift to IT and countercyclical policy helped reduce inflation from nearly 30% in 1990 to about 3% by the end of the decade. It also contributed to a reduction in output volatility.

Conclusion

• EMs have made progress in adopting countercyclical monetary policy, although large variations remain.
• The adoption of IT and institutional improvements are critical in enabling this shift.
• Financial market development is essential for EMs with flexible exchange rates to implement countercyclical policies.
• The global financial crisis temporarily reversed this trend, but the long-term benefits of countercyclical policy on output stability are evident.
• Continued institutional and financial reforms are necessary for EMs to sustain countercyclical monetary policy and improve macroeconomic outcomes.