The Monetary Transmission Mechanism in Egypt /

This paper examines the monetary transmission mechanism in Egypt against the background of the central bank's intention to shift to inflation targeting. It first describes the changing transmission channels over the last decade. Second, the channels are evaluated in a VAR model. The exchange ra...

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Bibliographic Details
Main Author: Al-Mashat, Rania
Other Authors: Billmeier, Andreas
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2007.
Series:IMF Working Papers; Working Paper ; No. 2007/285
Online Access:Full text available on IMF
Description
Summary:This paper examines the monetary transmission mechanism in Egypt against the background of the central bank's intention to shift to inflation targeting. It first describes the changing transmission channels over the last decade. Second, the channels are evaluated in a VAR model. The exchange rate channel plays a strong role in propagating monetary shocks to output and prices. Most other channels (bank lending, asset price) are rather weak. The interest rate channel is underdeveloped but appears to be strengthening since the introduction of the interest corridor in 2005, which bodes well for adopting inflation targeting over the medium term.
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Physical Description:1 online resource (43 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students