01796cas a2200241 a 4500 AALejournalIMF017908 230101c9999 xx r poo 0 0eng d 5.00 USD 9781484320648 1018-5941 BD-DhAAL BD-DhAAL Roch, Francisco. The Adjustment to Commodity Price Shocks in Chile, Colombia, and Peru / Francisco Roch. Washington, D.C. : International Monetary Fund, 2017. 1 online resource (25 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 presents a comparative analysis of the macroeconomic adjustment in Chile, Colombia, and Peru to commodity terms-of-trade shocks. The study is done in two steps: (i) an analysis of the impulse responses of key macroeconomic variables to terms-of-trade shocks and (ii) an event study of the adjustment to the recent decline in commodity prices. The experiences of these countries highlight the importance of flexible exchange rates to help with the adjustment to lower commodity prices, and staying vigilant in addressing depreciation pressures on inflation through tightening monetary policies. On the fiscal front, evidence shows that greater fiscal space, like in Chile and Peru, gives more room for accommodating terms-of-trade shocks. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2017/208 Full text available on IMF http://elibrary.imf.org/view/journals/001/2017/208/001.2017.issue-208-en.xml IMF e-Library