02029cas a2200241 a 4500 AALejournalIMF003483 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451861518 1018-5941 BD-DhAAL BD-DhAAL International Monetary Fund. Capital Account Liberalization and the Real Exchange Rate in Chile. Washington, D.C. : International Monetary Fund, 2005. 1 online resource (36 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students After the failure of the early 1980s, a second attempt at capital account liberalization was gradually carried out in Chile during the 1990s, this time in parallel with increased exchange rate flexibility. Capital account regulations were applied to support the independent monetary policy committed to the inflation target, while the exchange rate was quasi-pegged within a band that targeted the real exchange rate (RER). Still, the policy framework directed at stabilizing the RER appears to have been of limited effectiveness, with the surges and sudden-stops in capital flows playing an important role in RER dynamics. Foreign exchange market intervention appears not to have affected the RER while reserve requirement appears to have exerted a depreciating effect. Government spending and import tariffs, appear to be significant tools to moderate the real appreciation thus providing one additional reason for adopting a countercyclical fiscal policy and accelerating trade openness. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2005/132 Full text available on IMF http://elibrary.imf.org/view/journals/001/2005/132/001.2005.issue-132-en.xml IMF e-Library