02689cas a2200337 a 4500 AALejournalIMF022890 230101c9999 xx r poo 0 0eng d 15.00 USD 9781589067967 0251-6365 BD-DhAAL BD-DhAAL Nordstrom, Anna. The Role of the Exchange Rate in Inflation-Targeting Emerging Economies / Anna Nordstrom, Scott Roger, Mark Stone, Seiichi Shimizu. Washington, D.C. : International Monetary Fund, 2009. 1 online resource (104 pages) Occasional 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 role of exchange rates in emerging economies with inflation-targeting regimes, an issue that has become especially germane during the current episode of financial turmoil and volatile capital flows. Under inflation targeting, the interest rate is the main monetary policy tool for influencing activity and inflation, and there is little agreement about the appropriate role of the exchange rate.The exchange rate is a more important monetary policy tool for emerging economies that have adopted inflation targeting than it is for inflation-targeting advanced economies. Inflation-targeting emerging economies generally have less flexible exchange rate arrangements and intervene more frequently in the foreign exchange market than their advanced economy counterparts. The enhanced role of the exchange rate reflects these economies' greater vulnerability to exchange rate shocks and their less developed financial markets. However, their sharper focus on the exchange rate may cause some confusion about the commitment of their central banks to achieve the inflation target and may also complicate policy implementation. Global inflation pressures, greater exchange rate volatility, and the financial stresses from the global financial turmoil that began in mid-2007 are heightening these tensions. Mode of access: Internet Foreign Exchange imf Inflation imf International Financial Markets imf Monetary Policy imf Price Level imf Roger, Scott. Shimizu, Seiichi.. Stone, Mark. Occasional Papers; Occasional Paper ; No. 2009/004 Full text available on IMF https://elibrary.imf.org/openurl?genre=book&isbn=9781589067967 IMF e-Library