01746cas a2200253 a 4500 AALejournalIMF008941 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451862973 1018-5941 BD-DhAAL BD-DhAAL Di Giovanni, Julian. The Impact of Foreign Interest Rateson the Economy : The Role of the Exchange Rate Regime / Julian Di Giovanni, Jay Shambaugh. Washington, D.C. : International Monetary Fund, 2006. 1 online resource (46 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 This paper explores the connection between interest rates in major industrial countries and annual real output growth in other countries. The results show that high large-country interest rates have a contractionary effect on annual real GDP growth in the domestic economy, but that this effect is centered on countries with fixed exchange rates. The paper then examines the potential channels through which large-country interest rates affect small economies. The direct monetary policy channel is the most likely channel when compared with other possibilities, such as a general capital market effect or a trade effect. Mode of access: Internet Shambaugh, Jay. IMF Working Papers; Working Paper ; No. 2006/037 Full text available on IMF http://elibrary.imf.org/view/journals/001/2006/037/001.2006.issue-037-en.xml IMF e-Library